Why Sotheby's Shares Could Get Bid Up Above $50

While Fools should generally take the opinion of Wall Street with a grain of salt, it's not a bad idea to take a closer look at particularly stock-shaking analyst upgrades and downgrades -- just in case their reasoning behind the call makes sense.

What: Shares of Sotheby's (NYSE: BID  ) rallied 4% today after Barrington Research initiated coverage on the auction house operator with an outperform rating.

So what: Along with the bullish call, analyst Kristine Koerber planted a price target of $52 on the stock, representing about 24% worth of upside to yesterday's close. So while momentum traders might be turned off by Sotheby's year-to-date price weakness, Koerber's call could reflect a sense on Wall Street that its growth prospects are becoming too cheap to pass up.

Now what: According to Barrington, Sotheby's risk/reward trade-off is rather attractive at this point. "We believe favorable demographics and recent auction sales are positive signs for the market and Sotheby's," said Koerber. "We believe wealth creation should continue to fuel the art market for at least the next year as it appears to be a more globally diverse art market cycle than in the past." When you couple that upbeat outlook with Sotheby's sluggish stock price -- still off about 20% from its 52-week highs -- and forward P/E of 15, it's tough to disagree with Barrington's bullishness. 

Leaked: Apple's next smart device (warning, it may shock you)
Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out, and some early viewers are claiming its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 3014779, ~/Articles/ArticleHandler.aspx, 3/26/2015 7:52:26 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...