, Columnist
The Best Stock Research Money Can Buy
A study shows that: Wall Street stock analysts' research reports are no more reliable than reports that companies pay for themselves.
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The stereotype about Wall Street stock analysts has been well earned: They rarely say "sell," and their research reports often are compromised by investment-banking relationships or other conflicts of interest.
Now a new academic paper by three accounting professors has gone a step further. The authors studied a sample of 247 stock-research reports that were paid for by the companies being written about. They found the reports were just as reliable as comparable analyst reports issued by conventional brokerages. That's saying something, considering the reputation of paid-for research shops as hired guns, hype artists and pump-and-dump promoters.