Fidelity Investments' Acquisition Of Zacks: What's The Deal?

Zacks Investment Research is a Chicago-based research and money management firm founded in 1978. It provides institutional investors with quantitative models designed to predict stock prices for US companies. Fidelity Investments is a financial services company with a presence in eight countries and a large group of investment professionals who carry out extensive research to guide investors. While there is no evidence that Fidelity Investments owns Zacks, they do have a working relationship. Zacks provides research and analysis for Fidelity, and Fidelity offers investment advice and services to its clients.

Fidelity's Zacks Investment Research

Zacks Investment Research is a Chicago-based research and money management firm founded in 1978. It provides institutional investors with quantitative models designed to predict stock prices for US companies. Over the years, the company has expanded its product line to offer a wide range of investment-related information services and software tools to individual investors.

Zacks offers two stock rating systems: Zacks Rank and Zacks Recommendation. Each provides valuable insights into the future profitability of stocks and can be used separately or in combination. The Zacks Recommendation predicts performance over the next 6 to 12 months and is broken down into three levels: Outperform, Neutral, and Underperform. Meanwhile, the Zacks Rank is a short-term rating system effective over a one- to three-month holding horizon.

The Zacks Style Score complements the Zacks rating system, allowing investors to focus on the highest-rated stocks that align with their stock-picking preferences. The scores rate stocks on Value, Growth, and Momentum characteristics, assigning ratings of A, B, C, D, or F.

Zacks has a staff of 70 analysts who provide continuous coverage for approximately 1,200 US and Canadian traded stocks and NYSE-traded ADRs. Additionally, the Zacks Rating System covers 3,000 more stocks, generating model-driven snapshot research reports.

Fidelity Investments is a leader in the financial services industry, with a presence in eight countries and over 400 research professionals. It offers investment advice, brokerage services, retirement and wealth management services, securities execution, and insurance products to over 37 million individual investors.

Fidelity provides extensive research to guide investors on potential investment avenues worldwide. As of March 31, 2021, the company had total assets of about $10.4 trillion under management and managed more than 504 mutual funds across various categories, including domestic, foreign, equity, and fixed-income funds.

Fidelity and Zacks have a mutual connection through their respective research and investment services. Zacks provides research and ratings for various Fidelity mutual funds, and Fidelity utilizes Zacks' research and ratings to offer insights to its clients.

Zacks' Stock Rating System

Zacks Investment Research, founded in 1978, offers two stock rating systems: Zacks Rank and Zacks Recommendation. Each system provides valuable insights into the future profitability of a stock and can be used separately or in combination.

Zacks Rank

Zacks Rank is a short-term rating system that is most effective over a one- to three-month holding horizon. It is quantitatively determined by trends in earnings estimate revisions. The Zacks Rank List is made up of the top 5% of stocks with the most potential.

Zacks Recommendation

The Zacks Recommendation aims to predict performance over the next 6 to 12 months based on trends in a company's estimate revisions and earnings outlook. It is broken down into three levels: Outperform, Neutral, and Underperform. Analysts can override the Zacks Recommendation for the 1200 stocks they follow, as there are factors such as valuation, industry conditions, and management effectiveness that a trained professional can spot better than a quantitative model.

Zacks Style Score

The Zacks Style Score is a complementary indicator to the Zacks rating system. It allows investors to focus on the highest-rated stocks that align with their stock-picking preferences. Stocks are rated on Value, Growth, and Momentum characteristics, receiving a rating of A, B, C, D, or F. The VGM Score combines the weighted average of the individual Style Scores.

Zacks' Stock Research Reports

Zacks Investment Research is a Chicago-based research and money management firm founded in 1978. The company provides institutional investors with quantitative models designed to predict stock prices for US companies. Over the years, Zacks has expanded its product line to offer a wide range of investment-related information services and software tools to individual investors.

Zacks offers two stock rating systems: Zacks Rank and Zacks Recommendation. Each system provides valuable insights into the future profitability of stocks based on investors' holding horizons. These systems can be used separately or in combination to suit different investment styles.

The Zacks Recommendation aims to predict stock performance over the next 6 to 12 months by analysing trends in a company's estimate revisions and earnings outlook. It is broken down into three levels: Outperform, Neutral, and Underperform. Zacks employs a team of 70 analysts who are well-versed in interpreting earnings estimate revisions and can override the Zacks Recommendation for the stocks they follow. This is because certain factors, such as valuation, industry conditions, and management effectiveness, may be better evaluated by trained investment professionals than a quantitative model.

The Zacks Rank is a short-term rating system effective over a one- to three-month holding period. It is based on the same factors as the Zacks Recommendation, reflecting trends in earnings estimate revisions.

In addition to these rating systems, Zacks offers the Zacks Style Score, which allows investors to focus on the highest-rated stocks that align with their stock-picking preferences. The Zacks Style Scores rate stocks on Value, Growth, and Momentum characteristics, assigning a rating of A, B, C, D, or F. The VGM Score combines these individual Style Scores into one comprehensive score.

Zacks provides continuous coverage for approximately 1,200 US and Canadian traded stocks and NYSE-traded ADRs, including the S&P 500 and 700 of the next largest market cap and widely held stocks. Additionally, an extra 3,000 stocks are covered by the Zacks Rating System, generating model-driven snapshot research reports.

Analyst Written Reports are comprehensive documents ranging from 7 to 10 pages, offering an in-depth analysis of individual stocks. These reports include the Zacks Recommendation and Rank, along with a target price, valuation section, and Style Scores.

Zacks also maintains a model portfolio called the Zacks Focus List, designed for long-term investors. This portfolio is curated by Zacks Director of Research, Sheraz Mian, who selects 50 stocks most likely to outperform the market over the next 12 months from a universe of 3,000+ stocks. The Focus List is published weekly, detailing any additions or deletions.

Zacks also offers a range of other reports and services, including a Macro-economic Outlook, Market Strategy reports, Analyst Interviews, Industry Rank Analysis, and predefined stock search strategies.

Zacks' Model Portfolio

The Zacks Model Portfolio, also known as the Zacks Focus List, is a portfolio of 50 stocks personally selected by Zacks Director of Research Sheraz Mian from a universe of 3,000+ stocks. The portfolio is designed for long-term investors and is based on the Zacks Rank system, which predicts the future profitability of stocks. The Focus List is a Large Cap Blend strategy with a low annual turnover of approximately 20% of holdings. It is published weekly and lists any additions or deletions to the portfolio from the previous week.

The Zacks Rank system is a short-term rating system that is most effective over a one- to three-month holding horizon. It takes into account investors' holding horizons and is based on trends in earnings estimate revisions. The Zacks Recommendation, on the other hand, aims to predict performance over the next 6 to 12 months and is broken down into three levels: Outperform, Neutral, and Underperform.

Zacks Investment Research, a Chicago-based research and money management firm, was founded in 1978 to provide institutional investors with quantitative models designed to predict stock prices for US companies. Over the years, Zacks has expanded its product line to offer a wide range of investment-related information services and software tools to individual investors.

Zacks also offers a free Portfolio Tracker tool that allows investors to stay up-to-date on the Zacks Rank for the stocks in their portfolio. This tool provides daily email alerts on updated Zacks Rank and Style Scores, earnings estimate revisions, broker recommendation changes, and more.

Zacks' Research Firm Scorecards

Zacks Investment Research is a Chicago-based research and money management firm founded in 1978. The firm provides institutional investors with quantitative models designed to predict stock prices for US companies. Over the years, Zacks has expanded its product line to offer a wide range of investment-related information services and software tools to individual investors.

Zacks offers two stock rating systems: Zacks Rank and Zacks Recommendation. These systems provide valuable insights into the future profitability of stocks based on investors' holding horizons. The Zacks Recommendation predicts performance over the next 6 to 12 months and is broken down into three levels: Outperform, Neutral, and Underperform. Meanwhile, the Zacks Rank is a short-term rating system effective over a one- to three-month holding horizon.

In addition to these rating systems, Zacks also offers the Zacks Style Score, which complements the Zacks rating system by allowing investors to focus on the highest-rated stocks that align with their stock-picking preferences. The Zacks Style Scores rate stocks on Value, Growth, and Momentum characteristics, assigning a rating of A, B, C, D, or F.

Zacks also provides Analyst Written Reports, which offer in-depth analysis of individual stocks, including a target price, a valuation section, and Style Scores. These reports typically range from 7 to 10 pages.

Zacks maintains a model portfolio called the Zacks Focus List, which is designed for long-term investors. The portfolio includes 50 stocks hand-picked by Zacks Director of Research Sheraz Mian from a universe of 3,000+ stocks based on their potential to outperform the market over the next 12 months. The Zacks Focus List is published weekly and includes any additions or deletions to the portfolio.

Zacks also offers a range of research reports, including Economic Outlook, Market Strategy, Analyst Interview, and Industry Rank Analysis, providing investors with comprehensive insights and analysis to make informed investment decisions.

Fidelity Investments provides access to Zacks Investment Research through its platform, allowing its users to utilise Zacks' research and tools to inform their investment strategies.

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