Is It Worth Investing in Great Lakes Dredge & Dock (GLDD) Based on Wall Street's Bullish Views?

Core Viewpoint - The article discusses the reliability of brokerage recommendations, particularly focusing on Great Lakes Dredge & Dock (GLDD), and emphasizes the importance of using these recommendations in conjunction with other analytical tools like Zacks Rank to make informed investment decisions [1][5][10]. Group 1: Brokerage Recommendations - Great Lakes Dredge & Dock currently has an average brokerage recommendation (ABR) of 1.00, indicating a Strong Buy, based on recommendations from four brokerage firms, all of which are Strong Buy [2]. - Despite the Strong Buy recommendation, the article cautions against making investment decisions solely based on brokerage recommendations due to their historical limited success in predicting stock price increases [5][10]. - Brokerage firms often exhibit a strong positive bias in their ratings, with research indicating that for every "Strong Sell" recommendation, there are five "Strong Buy" recommendations, suggesting a misalignment of interests with retail investors [6][10]. Group 2: Zacks Rank - Zacks Rank categorizes stocks into five groups, from Strong Buy (Rank 1) to Strong Sell (Rank 5), and is based on earnings estimate revisions, which are strongly correlated with near-term stock price movements [8][11]. - The Zacks Consensus Estimate for GLDD has increased by 6.3% over the past month to $1.02, indicating growing optimism among analysts regarding the company's earnings prospects [13]. - The recent change in the consensus estimate, along with other factors, has resulted in a Zacks Rank 1 (Strong Buy) for Great Lakes Dredge & Dock, suggesting that the ABR may serve as a useful guide for investors [14].