4 Top Stocks That Shine After New Analyst Coverage

When a stock receives new analyst coverage, it often marks a pivotal moment for the company and can signal opportunities—or risks—for investors. Analyst coverage refers to financial experts, typically employed by investment banks or research firms, initiating or expanding their research on a company’s stock. These analysts provide reports that include ratings (buy, hold, or sell), price targets and key insights into a company’s performance, strategy and market potential.EMCOR Group, Inc. EME, Limbach Holdings, Inc. LMB, EZCORP, Inc. EZPW and Laureate Education, Inc. LAUR are four stocks that have witnessed new analyst coverage lately. These are, therefore, expected to attract investor attention.Here’s Why New Analyst Coverage MattersAnalysts typically possess specialized knowledge and expertise in particular industries or sectors. Through thorough research and analysis, they offer investors critical insights into a company's financial health, growth potential, competitive standing, and industry trends — insights that are often difficult for individual investors to acquire independently.Coverage initiation on a stock by analyst(s) usually portrays higher investor inclination. Investors, on their part, often assume that there is something special in a stock to attract analysts to cover it. In other words, they believe that the company coming under the microscope definitely holds some value.Do analysts create value for companies by initiating coverage? Of course, they do because they play an important intermediary role with their extensive access to relevant data. Many investors have immense faith in analysts’ research as they fear that a lack of information might trigger inefficiencies.Obviously, stocks are not randomly chosen to cover. A new coverage on a stock usually reflects a reassuring future envisioned by the analyst(s). At times, increased investor focus on a stock motivates analysts to take a closer look at it. After all, who doesn’t like to produce something that is already in demand? Hence, we often find that analysts’ ratings on newly added stocks are more favorable than their ratings on continuously covered stocks.Needless to say, the average change in broker recommendation is preferable to a single recommendation change. Again, if an analyst issues a new recommendation on a company that has very little or no existing coverage, investors start paying more attention to it. Also, any further information attracts portfolio managers to build a position in the stock.Impact on Stock PerformanceThe announcement of new coverage can cause immediate fluctuations in stock price. Positive ratings can attract bullish investors, while neutral or negative ratings may spark sell-offs. Meanwhile, consistent, positive coverage from multiple analysts can contribute to sustained investor confidence, potentially leading to higher valuations. Conversely, if the coverage reveals previously unrecognized risks, it can hinder long-term performance.So, it’s a good strategy to bet on stocks that have seen increased analyst coverage over the last few weeks.Screening CriteriaThe Number of Broker Ratings is greater than the Number of Broker Ratings four weeks ago (this will shortlist stocks that have recent new coverage).Average Broker Rating less than Average Broker Rating four weeks ago (“less than” means “better than” four weeks ago).Increased analyst coverage and improving average rating are the primary criteria of this strategy, but one should also consider other relevant parameters to make it foolproof.Here are the other screening parameters:Price greater than or equal to $5 (as a stock below $5 will not likely create significant interest for most investors).Average Daily Volume greater than or equal to 100,000 shares (if the volume isn’t enough, it will not attract individual investors).Here are four out of the five stocks that passed the screen:EMCOR Group: Headquartered in Norwalk, CT, this company is one of the leading providers of mechanical and electrical construction, industrial and energy infrastructure, as well as building services. EME stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.EME shares have gained 38.4% over the past three months, outperforming the industry’s 33% rise. Earnings per share (EPS) estimates for EME have moved north to $20.74 (from $19.50) for 2024 and to $22.24 (from $21.50) for 2025 in the past 30 days, depicting analysts’ optimism over the company’s prospects. Estimated figures indicate 55.5% and 7.2% growth for 2024 and 2025 from a year ago, respectively. It carries a VGM Score of B.Limbach: This Warrendale, PA-based company operates as a building systems solution provider. The company currently carries a Zacks Rank #1.LMB shares have gained 55.6% over the past three months, outperforming the industry’s 0.5% rise. EPS estimates for LMB have moved north to $2.54 (from $2.43) for 2024 and to $3.02 (from $2.81) for 2025 in the past 30 days. The estimated figures indicate 44.3% and 19.1% growth for 2024 and 2025, respectively, from a year ago.EZCORP: Based in Austin, TX, this company provides pawn services in the United States and Latin America. The company currently carries a Zacks Rank #2 (Buy).EZPW shares have gained 2.9% over the past three months compared with the industry’s 20.2% rise. EPS estimates for EZPW have moved north to $1.25 (from $1.23) for fiscal 2025 in the past seven days. The estimated figures indicate 11.6% growth for fiscal 2025 from a year ago. It has a VGM Score of A.Laureate Education: Based in Miami, FL, this company is a degree-granting higher education provider. The company currently carries a Zacks Rank #2.LAUR shares have gained 25.9% over the past three months, outperforming the industry’s 0.5% rise. EPS estimates for LAUR have moved north to $1.42 (from $1.41) for 2024 and to $1.44 (from $1.43) for 2025 in the past 30 days. The estimated figures indicate 91.9% growth for 2024 and 1.4% for 2025 from a year ago. It has a VGM Score of A.You can get the remaining stock on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your trading. Further, you can also create your strategies and test them first before taking the investment plunge.The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.Click here to sign up for a free trial of the Research Wizard today.Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.Disclosure: Performance information for Zacks’ portfolios and strategies are available at: https://www.zacks.com/performanceResearch Chief Names "Single Best Pick to Double"From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report EMCOR Group, Inc. (EME): Free Stock Analysis Report EZCORP, Inc. (EZPW): Free Stock Analysis Report Laureate Education (LAUR): Free Stock Analysis Report Limbach Holdings, Inc. (LMB): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks