Looking at the underlying ETF holdings in our coverage universe on ETF Channel, we compared the trading price of each holding to the 12-month futures analyst average target price, and calculated the weighted average implied analyst target price. for the ETF itself. For the SPDR Portfolio S&P 1500 Composite Stock Market ETF (Symbol: SPTM), we found that the analysts’ implied target price for the ETF based on its underlying holdings is $55.28 per share.
With SPTM trading at a recent price close to $47.16 per share, this means analysts see 17.23% upside potential for this ETF when looking at the average analyst targets of the underlying holdings. Shake Shack Inc (Symbol: SHAK), Enova International Inc (Symbol: ENVA) and RH (Symbol: RH) are three of SPTM’s underlying holdings with a notable advantage over their analyst price targets. Although SHAK traded at a recent price of $43.38/share, the average analyst target is 25.01% higher at $54.23/share. Similarly, ENVA is up 22.52% from the recent share price of $38.36 if the average analyst target price of $47.00/share is reached, and analysts expect average for RH to hit a target price of $319.13/share, 22.45% above the recent price of $260.63. Below is a 12 month price history chart comparing the performance of SHAK, ENVA and RH stocks:
Below is a table summarizing the current target prices of the analysts mentioned above:
|Last name||Symbol||Recent Price||Avg. 12-MB Analyst. Target||% increase over target|
|SPDR S&P 1500 Composite Stock Market ETF Portfolio||MTPS||$47.16||$55.28||17.23%|
|Shake Shack Inc.||SHAKE||$43.38||$54.23||25.01%|
|Enova International Inc.||ENV||$38.36||$47.00||22.52%|
Are analysts justified in these targets, or too optimistic about where these stocks will trade in 12 months? Do the analysts have a valid rationale for their goals, or are they lagging behind recent company and industry developments? A high price target relative to a stock’s price can reflect optimism about the future, but can also be a precursor to target price declines if targets were a relic of the past. These are questions that require further research from investors.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.