Traders and investors are often tempted to buy shares after seeing a\n\u2018Buy\u2019 or \u2018Overweight\u2019 recommendation from securities analysts. Yet such\nrecommendations are projections based on valuation and fundamentals.<\/p>\n
Analyst recommendations are usually based on valuations such as PBV\nand PER relative to historical averages, profit projections, and\nfundamental catalysts. All of these matter, but they are projective in\nnature and may take a long time to be reflected in the share price.<\/p>\n
The risk is that a share may be undervalued on paper yet remain under\npressure in the short term if market sentiment is negative or selling\npressure from large investors has not subsided. A cheap valuation does\nnot automatically mean the price will rise soon. For that reason, an\nanalyst\u2019s recommendation should be one input among many in share\nanalysis, not a single decisive signal.<\/p>\n
Why the Flow of Funds from Large Investors Matters as\nConfirmation<\/p>\n
Non-retail investors such as institutions and foreign players usually\nconduct deeper research, so the movement of their funds reflects a more\ngenuine conviction in the market. If a \u2018Buy\u2019 recommendation is\naccompanied by significant accumulation by large investors, the thesis\nbegins to gain the market\u2019s trust. Conversely, if it is not supported by\na corresponding flow of funds, or if distribution is actually taking\nplace, that could be a red flag. It does not necessarily mean the\nanalyst is wrong, but rather a matter of timing and confirmation.<\/p>\n
Recommendations for Undervalued Shares Amid Pressure on the Banking\nSector<\/p>\n
Throughout the first half of 2026, shares of major banks, including\nBMRI, came under sustained pressure due to the weakening rupiah and\nconcerns over net interest margin (NIM) compression, even though a\nnumber of analysts maintained their Buy recommendations on the grounds\nthat valuations had become cheap and earnings remained solid.<\/p>\n
This is where the Smart Money Movement Screener feature on Ajaib\nproves useful. Investors monitoring BMRI\u2019s share price can check whether\nthe share appears on the Top Non-Retail\/Foreign Accumulation list even\nas its price is under pressure.<\/p>\n
If BMRI appears on the Top Accumulation list whilst its price is\nfalling, that is further confirmation that large investors are beginning\nto believe the undervalued thesis and are taking advantage of discounted\nprices. If it is absent, or instead shows a distribution pattern in the\nHistory (M) column, selling pressure may not have subsided yet. Both\nscenarios are equally useful pieces of information before deciding\nwhether to follow a recommendation or wait for momentum.<\/p>\n
Validating Analysts\u2019 Recommendations More Robustly with Ajaib<\/p>\n
A \u2018Buy\u2019 rating from an analyst is a good starting point, but it is no\nguarantee that the price will move in line with the projection straight\naway. Always check whether the movement of large investors\u2019 money\nsupports the thesis, particularly for shares labelled undervalued that\nare still weighed down by short-term sentiment.<\/p>\n
Ajaib Terminal combines the Smart Money Movement Screener, Broker\nSummary, and Broker Distribution in a single platform, available on both\nmobile and desktop. Open Ajaib and check the Smart Money Movement\nScreener before following the next analyst recommendation.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/ajaib-helps-validate-market-analyst-recommendations-1784613426", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }