Analysts Anticipate FDM Will Reach $50

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 First Trust Dow Jones Select MicroCap Index Fund ETF (FDM), we found that the implied analyst target price for the ETF based upon its underlying holdings is $50.27 per unit.

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

With FDM trading at a recent price near $44.87 per unit, that means that analysts see 12.04% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of FDM's underlying holdings with notable upside to their analyst target prices are Meet Group Inc ( MEET), Radiant Logistics, Inc. ( RLGT), and Reading International Inc ( RDI). Although MEET has traded at a recent price of $2.51/share, the average analyst target is 139.04% higher at $6.00/share. Similarly, RLGT has 76.99% upside from the recent share price of $4.52 if the average analyst target price of $8.00/share is reached, and analysts on average are expecting RDI to reach a target price of $28.25/share, which is 75.25% above the recent price of $16.12. Below is a twelve month price history chart comparing the stock performance of MEET, RLGT, and RDI:

MEET, RLGT, and RDI Relative Performance Chart

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
First Trust Dow Jones Select MicroCap Index Fund ETF FDM $44.87 $50.27 12.04%
Meet Group Inc MEET $2.51 $6.00 139.04%
Radiant Logistics, Inc. RLGT $4.52 $8.00 76.99%
Reading International Inc RDI $16.12 $28.25 75.25%

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 MEET — FREE
Get the latest Zacks research report on RLGT — FREE
Get the latest Zacks research report on RDI — FREE

More from Stocks

Wall Street Futures Jump Higher, Global Markets Rally on US-China Trade Progress

Wall Street Futures Jump Higher, Global Markets Rally on US-China Trade Progress

Google, Trade, Brexit, Under Armour and Delta Air Lines - 5 Things You Must Know

Google, Trade, Brexit, Under Armour and Delta Air Lines - 5 Things You Must Know

Pfizer Slips Lower After JPMorgan Downgrade on Patent Cycle Concerns

Pfizer Slips Lower After JPMorgan Downgrade on Patent Cycle Concerns

Brexit: May Heads to Europe in Last Ditch-Effort to Save Britain's EU Exit Deal

Brexit: May Heads to Europe in Last Ditch-Effort to Save Britain's EU Exit Deal

Facebook Jumps on $9 Billion Buyback Plan, Bullish Note From Deutsche Bank

Facebook Jumps on $9 Billion Buyback Plan, Bullish Note From Deutsche Bank