Michel Pireu Columnist

At Merrill I achieved #1 status in Institutional Investor magazine’s analyst rankings for several years, moved to the West Cost in 1991, and operated from San Francisco for the remainder of my career. Once, a casual investor mentioned to me, before a round of golf, that he was about to purchase a particular stock in the aerospace-defence sector. His justification was something like "nine Wall Street Buy recommendations and only one neutral, all the favourable Street opinions have been in place for a year or longer, and the consensus price objective is some $18 above the current level". He obviously believed all this Street talk, having no idea that, given precisely the situation he described, perhaps he ought to be avoiding the stock. As a Street professional, I interpreted the situation such that the one lonely Neutral stance was really a Sell indication (probably insightful and timely). Street analysts use the terms Hold or Neutral to subtly indicate a negative view. I also though...

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