The Morningstar Star Rating for Stocks is assigned based on an analyst's estimate of a stocks fair value. It is projection/opinion and not a statement of fact. Morningstar assigns star ratings based on an analyst’s estimate of a stock's fair value. Four components drive the Star Rating: (1) our assessment of the firm’s economic moat, (2) our estimate of the stock’s fair value, (3) our uncertainty around that fair value estimate and (4) the current market price. This process culminates in a single-point star rating that is updated daily. A 5-star represents a belief that the stock is a good value at its current price; a 1-star stock isn't. If our base-case assumptions are true the market price will converge on our fair value estimate over time, generally within three years. Investments in securities are subject to market and other risks. Past performance of a security may or may not be sustained in future and is no indication of future performance. For detail information about the Morningstar Star Rating for Stocks, please visit here
Quantitative Fair Value Estimate represents Morningstar’s estimate of the per share dollar amount that a company’s equity is worth today. The Quantitative Fair Value Estimate is based on a statistical model derived from the Fair Value Estimate Morningstar’s equity analysts assign to companies which includes a financial forecast of the company. The Quantitative Fair Value Estimate is calculated daily. It is a projection/opinion and not a statement of fact. Investments in securities are subject to market and other risks. Past performance of a security may or may not be sustained in future and is no indication of future performance. For detail information about the Quantiative Fair Value Estimate, please visit here
The Morningstar Medalist Rating is the summary expression of Morningstar’s forward-looking analysis of investment strategies as offered via specific vehicles using a rating scale of Gold, Silver, Bronze, Neutral, and Negative. The Medalist Ratings indicate which investments Morningstar believes are likely to outperform a relevant index or peer group average on a risk-adjusted basis over time. Investment products are evaluated on three key pillars (People, Parent, and Process) which, when coupled with a fee assessment, forms the basis for Morningstar’s conviction in those products’ investment merits and determines the Medalist Rating they’re assigned. Pillar ratings take the form of Low, Below Average, Average, Above Average, and High. Pillars may be evaluated via an analyst’s qualitative assessment (either directly to a vehicle the analyst covers or indirectly when the pillar ratings of a covered vehicle are mapped to a related uncovered vehicle) or using algorithmic techniques. Vehicles are sorted by their expected performance into rating groups defined by their Morningstar Category and their active or passive status. When analysts directly cover a vehicle, they assign the three pillar ratings based on their qualitative assessment, subject to the oversight of the Analyst Rating Committee, and monitor and reevaluate them at least every 14 months. When the vehicles are covered either indirectly by analysts or by algorithm, the ratings are assigned monthly. For more detailed information about these ratings, including their methodology, please go to here
The Morningstar Medalist Ratings are not statements of fact, nor are they credit or risk ratings. The Morningstar Medalist Rating (i) should not be used as the sole basis in evaluating an investment product, (ii) involves unknown risks and uncertainties which may cause expectations not to occur or to differ significantly from what was expected, (iii) are not guaranteed to be based on complete or accurate assumptions or models when determined algorithmically, (iv) involve the risk that the return target will not be met due to such things as unforeseen changes in changes in management, technology, economic development, interest rate development, operating and/or material costs, competitive pressure, supervisory law, exchange rate, tax rates, exchange rate changes, and/or changes in political and social conditions, and (v) should not be considered an offer or solicitation to buy or sell the investment product. A change in the fundamental factors underlying the Morningstar Medalist Rating can mean that the rating is subsequently no longer accurate.
For information on the historical Morningstar Medalist Rating for any managed investment Morningstar covers, please contact your local Morningstar office.
For more detailed information about conflicts of interest, including EU MAR disclosures, please see the “Morningstar Medalist Rating Analyst Conflict of Interest & Other Disclosures for EMEA”here
FAQs
In the crowded world of investment analysis, Morningstar stands out as one of the best-known and well-respected providers. It's especially useful for mutual funds and ETFs, thanks to its five-star rating system.
Is Morningstar data accurate? ›
A study performed by Vanguard found that Morningstar's ratings were not a good method to predict performance when measured against a benchmark. Morningstar itself acknowledges its rating system as a quantitative measure of a fund's past performance that is not intended to accurately predict future performance.
Is a 5 star Morningstar rating good? ›
Funds are rated from one to five stars, with the best performers receiving five stars and the worst performers receiving as single star.
Is a 4 star Morningstar rating good? ›
The higher the number of stars, the better the fund's performance has been relative to similar funds. Five stars indicate a fund ranks in the top 10% of its peer group. Four stars is the second-highest group, comprising 22.5% of the category. One star indicates a fund ranks in the bottom 10%.
Which is better Zacks or Morningstar? ›
Zacks is much more quantitative in nature, while Morningstar uses fundamental analysis as a larger part of its recommendations. Morningstar appears to base its recommendations on an unbiased scale, while the Zacks Investment Research rating system is based solely on giving its members the most potential for profit.
Who is Morningstar's biggest competitor? ›
Morningstar's top competitors include AlphaSense, Moody's Analytics, and IHS Markit. AlphaSense develops a market intelligence platform. Its Artificial Intelligence (AI) technology aims to help professionals make business decisions by offering insights …
Is Morningstar is better than Bloomberg? ›
When assessing the two solutions, reviewers found Bloomberg Terminal easier to use and do business with overall. However, reviewers preferred the ease of set up with Morningstar Direct, along with administration. Reviewers felt that Bloomberg Terminal meets the needs of their business better than Morningstar Direct.
Which is better, Morningstar or Seeking Alpha? ›
Seeking Alpha vs Morningstar
Seeking Alpha's analysis is subjective, opinionated, and crowdsourced from thousands of contributors. It also has more ratings data and more tools for quantitative analysis. Morningstar's analysis is more objective and professional, and the same is true about its ratings.
Where does Morningstar get its data from? ›
Morningstar collects and presents data via its own team of dedicated Data Analysts. The data is captured primarily from Audited source materials such as Annual Report and Accounts and mid-year financial releases.
What are the 10 best stocks to buy right now? ›
Sign up for Kiplinger's Free E-Newsletters
Company (ticker) | Analysts' consensus recommendation score | Analysts' consensus recommendation |
---|
ServiceNow (NOW) | 1.49 | Strong Buy |
Assurant (AIZ) | 1.50 | Strong Buy |
Howmet Aerospace (HWM) | 1.50 | Strong Buy |
Insulet (PODD) | 1.50 | Strong Buy |
21 more rows
Morningstar Return - Mutual Funds
In each Morningstar Category, the top 10% of funds earn a High Morningstar Return, the next 22.5% Above Average, the middle 35% Average, the next 22.5% Below Average, and the bottom 10% Low. Morningstar Return is measured for up to three time periods (three-, five-, and 10-years).
What is the best mutual fund to invest in in 2024? ›
- Fidelity 500 Index Fund. : Best overall.
- Fidelity Large Cap Growth Index Fund. : Best for growth investors.
- Fidelity Investment Grade Bond Fund. ...
- Fidelity Total Bond Fund. ...
- Vanguard Wellesley Income Fund Investor Shares. ...
- Schwab Fundamental US Large Company Index Fund. ...
- Schwab S&P 500 Index Fund. ...
- Vanguard High-Yield Tax-Exempt Fund.
How trustworthy is Morningstar? ›
Morningstar reviews of mutual funds and ETFs can be helpful for comparing investments, especially if you're just getting started with the markets. Morningstar is a respected and trusted institution and both the Star and Analyst Ratings are calculated using a systematic approach.
How to get Morningstar ratings for free? ›
Where can I find Morningstar ratings? Wealth and asset managers can augment their research with ratings and in-depth analysis in professional Morningstar software. Investors can find our ratings for free on morningstar.com by searching the stock ticker symbol.
What is the difference between Morningstar Rating and Morningstar analyst rating? ›
To receive a Morningstar Rating, a fund must have a record of more than three years. Morningstar assigns the Analyst Rating to funds that analysts qualitatively assess, typically through manager interviews and other sources.
Is Morningstar better than Seeking Alpha? ›
Seeking Alpha vs Morningstar
It also has more ratings data and more tools for quantitative analysis. Morningstar's analysis is more objective and professional, and the same is true about its ratings. If you want opinions, choose Seeking Alpha. If you want objectivity, choose Morningstar.
Is Morningstar Premium worth the cost? ›
You should pay for Morningstar Premium if you're a fundamental investor who buys individual stocks (how to buy stocks online), mutual funds, and/or ETFs and want access to objective, data-driven analysis.
Are Morningstar newsletters worth it? ›
Morningstar is much more than a newsletter publisher. They offer a crazy amount of tools and resources for investors, advisors, and asset managers. Their newsletter just so happens to provide a lot of value, too.