CFA Level I · CFA Level I Exam · Equity Analyst Research Reports
An equity research report is most likely intended to serve which primary purpose for its readers?
The main purpose of an equity research report is to communicate the analyst's investment view and the analysis behind it so readers can make informed decisions. It does not guarantee price targets and does not substitute for the issuer's audited financial statements.
- ATo communicate the analyst's investment view and supporting analysis so readers can make informed decisionsCorrect
- BTo guarantee the share price will reach the stated target within the forecast period
- CTo replace the issuer's audited financial statements as the source of reported results
Explanation
A research report presents the analyst's analysis, valuation and recommendation to help investors decide. It cannot guarantee a price target, and it relies on, rather than replaces, the issuer's audited statements.
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