Looking at the underlying holdings of the ETFs in our coverage universe at ETF Channel, we have compared the trading price of each holding against the average analyst 12-month forward target price, and computed the weighted average implied analyst target price for the ETF itself. For the iShares Core S&P Mid-Cap ETF (Symbol: IJH), we found that the implied analyst target price for the ETF based upon its underlying holdings is $73.59 per unit.
With IJH trading at a recent price near $61.90 per unit, that means that analysts see 18.89% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of IJH's underlying holdings with notable upside to their analyst target prices are Abercrombie & Fitch Co (Symbol: ANF), Under Armour Inc (Symbol: UA), and Coherent Corp (Symbol: COHR). Although ANF has traded at a recent price of $102.99/share, the average analyst target is 77.27% higher at $182.57/share. Similarly, UA has 73.23% upside from the recent share price of $6.35 if the average analyst target price of $11.00/share is reached, and analysts on average are expecting COHR to reach a target price of $115.06/share, which is 53.03% above the recent price of $75.19. Below is a twelve month price history chart comparing the stock performance of ANF, UA, and COHR:
Below is a summary table of the current analyst target prices discussed above:
| Name | Symbol | Recent Price | Avg. Analyst 12-Mo. Target | % Upside to Target |
|---|---|---|---|---|
| iShares Core S&P Mid-Cap ETF | IJH | $61.90 | $73.59 | 18.89% |
| Abercrombie & Fitch Co | ANF | $102.99 | $182.57 | 77.27% |
| Under Armour Inc | UA | $6.35 | $11.00 | 73.23% |
| Coherent Corp | COHR | $75.19 | $115.06 | 53.03% |
Are analysts justified in these targets, or overly optimistic about where these stocks will be trading 12 months from now? Do the analysts have a valid justification for their targets, or are they behind the curve on recent company and industry developments? A high price target relative to a stock's trading price can reflect optimism about the future, but can also be a precursor to target price downgrades if the targets were a relic of the past. These are questions that require further investor research.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
