Hi all. Care to comment if you wish. I have a strange observation, been following BAA on my RBC brokerage platform which has research and ratings (provided by Morningstar) for almost two yrs now.
There has been a lot of activity lately with regard to changes in the ratings on my trading platform, after no activity at all since I started looking at BAA almost 2 yrs ago.
The rating system is a simple 1 (strong buy), 3 (hold), 5 (strong sell), etc. They also provide value rating as undervalued (green), fairly-valued (yellow) and overvalued (red).
Regarding BAA on the AMEX, BAA had always been rated at 4 and rated undervalued since i started looking at it on my trading platform but this week moved to 2.5 (on Monday) and overvalued (on Thursday).
What is even more interesting is looking at the rating changes for BAA on the TSX. It has always been at 4 and undervalued since I started following. This week it changed day by day by day. First on Monday the 4 was removed and now its number rating is blank. On Tuesday the undervalued (green) changed to fairly-valued (yellow), and then on Thursday changed to overvalued (red).
i cannot understand the nature of these changes, all in a short period of time, i mean going from under to fairly to over valued in a week seems fishy to me (3 changes). you would think they would do the analysis and make a single rating adjustment, i mean, i considering ratings to be longer term in context and should not change day by day.
Also note, there was no re-rating activity last year when BAA spiked up in the spring and then came back down during the summer.
I just have to laugh and question why this re-rating activity is happening now, and how it is being done.
I am also perplexed by the number rating being removed on BAA TSX, and improving to 2.5 for BAA AMEX, yet the value rating now on both now sits as overvalued (which shows up in a big fat red graphic lol). It improves from sell to hold, while at the same time rates from undervalued to overvalued. Seems counter intuitive lol. But I dont care as my view is that it should be a 1 (strong buy) and still undervalued (green) lol.
Anyway. just thought i would share. have a great weekend.
Long BAA
