Add Up The Parts: The iShares Core S&P 500 ETF Could Be Worth $315
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 500 ETF, we found that the implied analyst target price for the ETF based upon its underlying holdings is $314.80 per unit.
With IVV trading at a recent price near $266.05 per unit, that means that analysts see 18.32% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of IVV’s underlying holdings with notable upside to their analyst target prices are M & T Bank, Parker Hannifin and Advance Auto Parts. Although MTB has traded at a recent price of $153.56/share, the average analyst target is 21.94% higher at $187.25/share. Similarly, PH has 21.51% upside from the recent share price of $153.83 if the average analyst target price of $186.92/share is reached, and analysts on average are expecting AAP to reach a target price of $197.75/share, which is 19.27% above the recent price of $165.80.
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 500 ETF||IVV||$266.05||$314.80||18.32%|
|M & T Bank Corp||MTB||$153.56||$187.25||21.94%|
|Parker Hannifin Corp||PH||$153.83||$186.92||21.51%|
|Advance Auto Parts Inc||AAP||$165.80||$197.75||19.27%|
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.
Click here to find out 10 ETFs With Most Upside To Analyst Targets »