With the Aussie share market still battening down the hatches and the 85% probability of a Santa Rally sinking hopes each day, its interesting to see what the consensus is saying about where the market should be.
The table below comes from ASXIQ who has collated the median price targets of analysts and brokers followed by Thomson Reuters for the S&P/ASX20, i.e the top 20 blue chip companies on the ASX. The table sorts the highest spread between the price targets and yesterday’s price:
The average price target is some 20% away from the average price, with resource companies dominating, particularly the “ASX8” twins, BHP-Billiton and Rio Tinto, but also gold miner Newcrest and top energy stock Woodside Petroleum.
Macquarie Group seems to be overly bullish as well, although interestingly, the other ASX8 financials – the big four banks – have tighter spreads, with Commonwealth Bank’s price target just over $50.
Whether or not these price targets remain in the area of delusion or thoughtful analysis is another thing, but it appears the resource sector has not had any decent macro-analysis coverage for some time.