Underperform (redirected from underperformed)

Underperform

An analyst recommendation that means a stock is expected to do slightly worse than the market return.

Also known as market underperform, moderate sell, or weak hold.

Notes:

Exact definitions vary between brokerages, but in general this rating is worse than neutral but better than sell or strong sell.

See also: Buy, Downgrade, Hold, Outperform, Sell, Upgrade

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Underperform

In general, this means to do worse than some particular benchmark. Mutual Fund XYZ is said to underperform the S&P500 if its return falls short of the S&P500 return. However, this language does not take risk into account. That is, one might have a lower return than the benchmark in a particular year because of lower risk exposure. Underperform is also a term used by analysts to describe the prospects of a particular company. Usually, this means that the company will do worse than its industry average. Related: outperform.