SmarFinancial (NYSE: SMBK) could be a solid addition to your portfolio given its recent upgrade to a Zacks Rank #1 (Strong Buy). This rating change essentially reflects an upward trend in earnings estimates — one of the most powerful forces impacting stock prices.
The sole determinant of the Zacks rating is a company’s changing earnings picture. The Zacks Consensus Estimate — the consensus of EPS estimates from the sell-side analysts covering the stock — for the current and following years is tracked by the system.
Since a changing earnings picture is a powerful factor influencing near-term stock price movements, the Zacks rating system is very useful for individual investors. They may find it difficult to make decisions based on rating upgrades by Wall Street analysts, as these are mostly driven by subjective factors that are hard to see and measure in real time.
As such, the Zacks rating upgrade for SmarFinancial is essentially a positive comment on its earnings outlook that could have a favorable impact on its stock price.
Most Powerful Force Impacting Stock Prices
The change in a company’s future earnings potential, as reflected in …
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