People listen to Wall Street types like their word is scripture—and it’s anything but. They’re getting their information secondhand, thirdhand. They’re smart people, sure. They just don’t have the info.
And that is why we use analyst sentiment as a contrarian indicator. Kind of like magazine covers—by the time the suits catch a trend, that trend might be about to turn. So we actually want to find stocks where analysts are disinterested, or outright negative, or just asleep at the wheel. Because that is where the value hides—especially when those hated stocks are paying fat dividends.
I have my eye on five of them right now, yielding 6.5% to 15.6%.
This post originally appeared at Contrarian Outlook.