Peek Under The Hood: PUW Has 13% Upside

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 PowerShares WilderHill Progressive Energy Portfolio ETF ( PUW), we found that the implied analyst target price for the ETF based upon its underlying holdings is $26.91 per unit.

START SLIDESHOW:
10 ETFs With Most Upside To Analyst Targets »

With PUW trading at a recent price near $23.83 per unit, that means that analysts see 12.93% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of PUW's underlying holdings with notable upside to their analyst target prices are NRG Yield Inc ( NYLD), Cosan Ltd ( CZZ), and Green Plains Inc. ( GPRE). Although NYLD has traded at a recent price of $14.50/share, the average analyst target is 44.83% higher at $21.00/share. Similarly, CZZ has 18.47% upside from the recent share price of $8.30 if the average analyst target price of $9.83/share is reached, and analysts on average are expecting GPRE to reach a target price of $27.75/share, which is 15.62% above the recent price of $24.00. Below is a twelve month price history chart comparing the stock performance of NYLD, CZZ, and GPRE:

NYLD, CZZ, and GPRE Relative Performance Chart

Combined, NYLD, CZZ, and GPRE represent 8.89% of the PowerShares WilderHill Progressive Energy Portfolio ETF. 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
PowerShares WilderHill Progressive Energy Portfolio ETF PUW $23.83 $26.91 12.93%
NRG Yield Inc NYLD $14.50 $21.00 44.83%
Cosan Ltd CZZ $8.30 $9.83 18.47%
Green Plains Inc. GPRE $24.00 $27.75 15.62%

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.

The average analyst target price data upon which this article was based, is courtesy of data provided by Zacks Investment Research via Quandl.com.
Get the latest Zacks research report on NYLD — FREE
Get the latest Zacks research report on CZZ — FREE
Get the latest Zacks research report on GPRE — FREE

If you liked this article you might like

PowerShares WilderHill Progressive Energy Portfolio Getting Very Oversold

PowerShares WilderHill Progressive Energy Portfolio Getting Very Oversold

Oil Rally Opens Solar Window

Oil Rally Opens Solar Window

A Green Fund That Still Soars

A Green Fund That Still Soars

The Best Clean Energy ETFs Aren't the Cleanest

The Best Clean Energy ETFs Aren't the Cleanest

Focusing on Alternative Energy Plays

Focusing on Alternative Energy Plays