Ignore Analysts

What are these guys (or gals) thinking?

Often a day late and a dollar short

Package delivery giant United Parcel Service (UPS) disappointed investors last week when Q4 EPS came in light and 2015 estimates needed to be reduced.

Analysts who had been loving the stock above $114 last Thursday were busy over the weekend downgrading from Buy to Hold.

Jan. 26, 2015's pre-market opinion changes helped UPS open on Monday morning at just $101.70, down a cool $12.70 a share from where it was rated as "Outperform" just two trading days earlier.

Waiting for those lowered ratings before selling cost traders 11.1%. That’s more than the DJIA gained in all of 2014.

 Even after the morning’s drop UPS was not especially cheap. It still fetched 19.1x the newly reduced 2015 estimate and yielded 2.64%. That compares unfavorably with the firm’s post-recession average levels of 18.2x EPS, along with 2.84% in current yield.

Anlaysts often miss on the flip side as well. Oppenheimer saw fit to upgrade Bed, Bath & Beyond (BBBY) pre-market on Monday. BBBY shares were rated ‘neutral’ at $55 last summer and near $62 during October, 2014.

Read More at: GuruFocus.