Joy Wallet is advertiser-supported: we may earn compensation from the products and offers mentioned in this article. However, any expressed opinions are our own and aren't influenced by compensation. To read our full disclosure, click here.
As a young investor, I sometimes relied on stock recommendations from my broker. I know this probably sounds foreign today, but I visited my broker’s office at Merrill Lynch, and we’d discuss stocks. Sometimes, his picks were spot on, and sometimes they weren’t.
I quickly learned how to research company stocks on my own. One lesson I discovered was that I’d have better luck following recommendations from several analysts instead of just one. Duh. I know that sounds like common sense, but finding someplace where stock data was aggregated wasn’t as easy then as it is now.
I came across stock research from Zacks Investment Research aggregating stock earnings forecasts from major Wall Street firms. It showed the analysts’ recommendations for a stock, from strong buy down to strong sell. I no longer had to rely on my guy at Merrill Lynch but could see what most other analysts thought. Of course, they weren’t the end of my research when choosing stocks, but they gave me a head start to learn more.
In this article
What is Zacks Investment Research?
Zacks Investment Research was founded in 1978 by Len Zacks, based on work he was doing to earn a Ph.D. at MIT. The company is headquartered in Chicago.
His research focused on earnings estimate revisions by Wall Street analysts and went beyond basic earnings forecasts. He found that if analysts revised earnings estimates upwards, those stocks tended to outperform others. Stocks downgraded from buy to sell tended to underperform the market.
Zacks Research provides financial data and analysis through reports, charts, watchlists, and other information for analysts to inform their clients. Individual investors also use the service.
The company also offers Zacks Ranks, which gives stock ratings on a scale of one to five, with a number one ranking meaning a strong buy. Its Zacks Trade platform is a stock trading website for beginners and experienced traders.
The Motley Fool is offering its top stock-picking service at 50% off for new members.*
*$99 is an introductory price for new members only. 50% discount based on current list price of Stock Advisor of $199/year. Membership will renew annually at the then-current list price.
How does Zacks Investment Research work?
On Zacks’ home page you can look around and get a feel for what it offers. To sign up for its service and pay or use the free version, start at the home page and click the “Join Now” link.
That will take you to the Zacks Membership page. Its free service offers an e-newsletter and portfolio tracker. The 30-day trials aren't free but are offered for the higher levels called Zacks Premium and Zacks Ultimate, which we’ll go over later on costs and features.
Signing up for a free membership starts with providing your email address.
From there, it asks for your contact information before confirming your free subscription. Paid subscriptions work the same way, with a free 30-day trial.
Use Motley Fool's Stock Advisor To Invest
- Over 100 Stock Picks with 100%+ Returns
- Averaged Stock Pick Return over 593% (vs. 165% for the S&P)
- 2 New Stock Picks Every Month
- Investment Community With 700,000+ Loyal Members
- 30-Day Membership-Fee-Back Guarantee
- Joy Wallet Reader Deal: The Motley Fool is offering 50% off its top stock-picking service for new members (Limited Time)
How much does Zacks Investment Research cost?
There are two levels of Zacks ’ memberships, and a third is free.
Free
Free membership includes access to free articles, a portfolio tracker, stock prices, charts, and basic research.
One of the best benefits of free membership may be the Zacks Rank for stocks, mutual funds, and exchange-traded funds (ETFs). Zacks Ranks rates stocks on a scale of one to five. A top ranking of No. 1 means “strong buy.”
Zacks Premium
Zacks Premium costs $249 per year.
It includes everything in the free version and adds industry ranks, equity research reports, and premium screens.
It includes the Zacks Premium Screener, allowing users to sort and search for stocks according to factors such as dividends, return on investment, price changes, and earnings per share through Zacks Rank.
Long-term investors and day traders may find extra benefits from Zacks Premium.
The Motley Fool is offering its top stock-picking service at 50% off for new members.*
*$99 is an introductory price for new members only. 50% discount based on current list price of Stock Advisor of $199/year. Membership will renew annually at the then-current list price.
Zacks Ultimate
Zacks Ultimate costs $299 per month. At the sign-up stage, you'll be charged $1 for 30-day access.
Several investment approaches can be sampled to find ones that best fit your trading style and risk tolerance. These include advice for investors looking for a home run, income, ETFs, stocks under $10, and value investors.
Zacks Ultimate includes everything the first two plans do, a list of the top 10 stocks, and tools for long- and short-term investors with any type of investment strategy.
Use Motley Fool's Stock Advisor To Invest
- Over 100 Stock Picks with 100%+ Returns
- Averaged Stock Pick Return over 593% (vs. 165% for the S&P)
- 2 New Stock Picks Every Month
- Investment Community With 700,000+ Loyal Members
- 30-Day Membership-Fee-Back Guarantee
- Joy Wallet Reader Deal: The Motley Fool is offering 50% off its top stock-picking service for new members (Limited Time)
Zacks Investment Research features
Zacks Rank
One of Zacks’ most notable features is Zacks Ranks, a set of investment ratings based on a stock’s earnings potential. Ratings are in five categories:
- #1: Strong buy
- #2: Buy
- #3: Hold
- #4: Sell
- #5: Strong sell
From January 1, 1988, through March 4, 2024, the Zacks Rank has more than doubled the S&P 500 with an average gain of 24.15% per year.
Zacks Rank recommends stocks with rising earnings estimates because it has found that such stocks are most likely to outperform. It also ranks ETFs and mutual funds.
The ranking measures earnings potential through a number of ways, such as if brokerage analysts are unanimous in assessing the change in a stock’s valuation and the size of the latest change in analysts’ consensus.
According to Zacks, institutional buyers typically increase their positions in a stock where earnings estimates are revised upwards, which can raise the stock’s price more.
The Motley Fool is offering its top stock-picking service at 50% off for new members.*
*$99 is an introductory price for new members only. 50% discount based on current list price of Stock Advisor of $199/year. Membership will renew annually at the then-current list price.
Earnings surprises
According to Zacks, companies with a positive earnings surprise—also called earnings per share, or EPS—are more likely to surprise again in the future.
You may more widely know this as beating earning projections. When a company reports higher earnings than analysts or the company expected, the earnings surprise can cause a company’s stock price to jump immediately and gradually over time.
Using math
Zacks Investment Research prides itself on research reports and other data from a quantitative stock-rating system based simply on math. It relies heavily on earnings per share, or EPS, related metrics, such as revisions to projected earnings.
Zacks collects data daily on over 8,500 North American publicly traded companies from several brokerage firms. It then finds the expert consensus on the earnings potential of specific stocks.
Using math instead of the preferences of individual analysts can be a lot easier to rely on as an investor.
Stock Screener
The Zacks Stock Screener lets investors use metrics such as price changes, dividends, return on investment, a 52-week high, Zacks Rank, and more than a dozen others to find stocks that meet their investment goals.
Predefined screens can also be used to filter stocks with outstanding historical earnings and predicted future growth. Earnings surprises from past growth are also included in the criteria because, according to Zacks, stocks that have surprised in the past are more likely to surprise again in the future.
Many of these screens are free. For more in-depth information, premium screens are available with a premium membership starting at $249 per year.
Use Motley Fool's Stock Advisor To Invest
- Over 100 Stock Picks with 100%+ Returns
- Averaged Stock Pick Return over 593% (vs. 165% for the S&P)
- 2 New Stock Picks Every Month
- Investment Community With 700,000+ Loyal Members
- 30-Day Membership-Fee-Back Guarantee
- Joy Wallet Reader Deal: The Motley Fool is offering 50% off its top stock-picking service for new members (Limited Time)
Zacks Trade
The trading platform Zacks Trade isn’t part of the paid or free memberships, but investors can use it to trade stocks for 1 cent per share and at least $2,500 in the brokerage account.
Who is Zacks Investment Research best for?
- Beginners. Beginners who want to try the free version of Zacks Investment Research can’t go wrong exploring the site. Reviewing the Zacks Rank stocks rated “strong buy” and investing extra cash in one for a few months is enticing.
- Short- and long-term investors. Day traders and long-term investors may want to consider the premium services. They’re expensive at $299 for one month of Zacks Ultimate, but the extra insights may make them worthwhile.
- Looking for unbiased data. The Zacks Ranks lists and other data make Zacks a worthwhile option to look into before buying a stock, ETF, or mutual fund. The Zacks Stock Screener, with all kinds of metrics you can filter, can be information overload, or you can use it to pick and choose factors that matter most to you. This is all a lot better than just talking with your broker.
The Motley Fool is offering its top stock-picking service at 50% off for new members.*
*$99 is an introductory price for new members only. 50% discount based on current list price of Stock Advisor of $199/year. Membership will renew annually at the then-current list price.
Who shouldn’t use Zacks Investment Research?
You don’t like paying for data. There’s nothing wrong with researching stocks on your own. It can be a lot of fun, and you can learn a lot. Paying $250 or a few thousand dollars for one year’s access to data that you might think is pretty common can seem insane.
Until you add up the cost of your time. And if the cost is way less than the profit you earn by using the data to buy “strong buy” stocks.
But still, paying for something you can find for free on your own can look like unwise spending.
After all, free membership in Zacks will give you at least one month of free data, including the Zacks Rank data that shows you some of the best stocks it recommends. Buy a few of those, and you could profit without much work. Then maybe you’ll decide the annual fee is worthwhile.
Use Motley Fool's Stock Advisor To Invest
- Over 100 Stock Picks with 100%+ Returns
- Averaged Stock Pick Return over 593% (vs. 165% for the S&P)
- 2 New Stock Picks Every Month
- Investment Community With 700,000+ Loyal Members
- 30-Day Membership-Fee-Back Guarantee
- Joy Wallet Reader Deal: The Motley Fool is offering 50% off its top stock-picking service for new members (Limited Time)
Pros and cons
Pros
- Finding a stock that beats the S&P 500 is relatively easy with Zacks Rank.
- With many predefined screens, the Zacks Stock Screener makes it easy to set stock-picking criteria that match your investment goals and risk tolerance.
- Beginners should easily be able to research stocks, ETFs, and mutual funds with Zacks Investment Research.
Cons
- The high costs of Zacks’ paid services may be too high for some people.
- At a time when many online brokerages don’t charge for stock trades, Zacks Trades charges $0.01 per share traded, with a $1 minimum per trade.
- It’s unclear from Zacks’ promotion of its ranking service if the long-term gains of “strong buy” stocks are met in the short run by day traders.
Zacks vs. Morningstar vs. Motley Fool vs. Seeking Alpha
How does Zacks stack up to Morningstar, The Motley Fool Stock Advisor, and Seeking Alpha investment research companies?
Research site | Cost | Best feature |
Zacks Investment Research | Free or $249 per year to $299 per month | Zacks Rank |
Morningstar | $249 per year | Star-rated picks |
Motley Fool | $199/year | New stock picks monthly |
Seeking Alpha | $239 to $2,400 per year | A lot of data |
Morningstar
Morningstar is best for intermediate and active investors among the stock-picking services we reviewed. Its stock screener can review thousands of criteria that users can set, such as risk tolerance and dividends.
Morningstar is well known for its star rating system, which helps users guide their stock-picking decisions. Like Zacks, the ratings are created with math instead of human opinions, though Morningstar offers insights and picks from 150 independent analysts.
It has a Portfolio X-Ray tool to analyze your portfolio after linking to your brokerage account.
Read a full review on Morningstar.
The Motley Fool Stock Advisor
The Motley Fool Stock Advisor has a long track record of outperforming the market as a stock-picking and research service. It’s best for people who plan to do a moderate level of trading and can be helpful for beginners, too, with educational services and investment advice.
One of its key features is the two monthly stock recommendations from its founders, Tom and David. They also share their “Best Buys” list to help guide stock picks for users.
The Motley Fool is offering its top stock-picking service at 50% off for new members.*
*$99 is an introductory price for new members only. 50% discount based on current list price of Stock Advisor of $199/year. Membership will renew annually at the then-current list price.
Seeking Alpha
Seeking Alpha is designed for intermediate to advanced investors. It offers fundamental analysis, financial news, investing insights, and more.
One of the best things about Seeking Alpha is the vast amount of data it provides subscribers. It includes earning calls transcripts, author ratings, author performance metrics, 10 years of financial statements, the ability to compare stocks side-by-side with peers, access to dividends and earnings forecasts, and more.
Seeking Alpha has more than 17,000 contributors to its stock analysis. In-house editors check the information before it's reviewed and discussed by millions of readers.
Read a full review on Seeking Alpha.
FAQs
Can I be a passive investor with all of this data?
Passive investing is a kind of set it and forget it way of thinking about the stock market that follows the market instead of beating it. There’s nothing wrong with this, and is often used when planning for retirement. You can do a lot of research at Zacks or elsewhere on stocks, mutual funds and other investments, and it could leave you confused or overwhelmed. But one point of these services is to help make your stock-picking decisions easier, so you could still do your research, buy the stocks you want, and sit back and hopefully watch them grow for years to come. On the other hand, all of this data may spurn you to become a more active trader. Most active fund managers underperform the market, so you shouldn’t expect to beat them or the market as a day trader. But researching stocks and then watching what your investments do over the short- and long-term can show you if you’re doing it right.
Is this research best for stocks or mutual funds?
Both. Diversification is important in an investment portfolio, and a stock research site such as Zacks can help you choose individual stocks that will increase your stock-specific risk, and mutual funds that can spread your risk. You should realize that doing all of this research can be time-consuming and possibly stressful.
Can I find a lot of this data by searching the internet?
It’s unlikely. Or if you can, it can take a lot of time. Some investment research sites have proprietary software that’s only available to subscribers, and ratings such as Zacks Rank can boil a stock choice down to a number that quickly shows you if it’s worth buying. If paying for a service isn’t for you, then check if the service has a free trial period, as Zacks does. Give it a test run and see if it works as easily as you want it to.
Use Motley Fool's Stock Advisor To Invest
- Over 100 Stock Picks with 100%+ Returns
- Averaged Stock Pick Return over 593% (vs. 165% for the S&P)
- 2 New Stock Picks Every Month
- Investment Community With 700,000+ Loyal Members
- 30-Day Membership-Fee-Back Guarantee
- Joy Wallet Reader Deal: The Motley Fool is offering 50% off its top stock-picking service for new members (Limited Time)
The bottom line
Too much data can be overwhelming. Zacks Investment Research can make stock picking a lot easier by providing data in the Zacks Stock Screener so you can pick data points that are important to you and meet your tolerance for risk and investment style. A free version is worth trying for a month, and then you should be able to decide if paying $249 or more a year is worth it.
Joy Wallet is an independent publisher and comparison service, not an investment advisor, financial advisor, loan broker, insurance producer, or insurance broker. Its articles, interactive tools and other content are provided to you for free, as self-help tools and for informational purposes only. They are not intended to provide investment advice. Joy Wallet does not and cannot guarantee the accuracy or applicability of any information in regard to your individual circumstances. We encourage you to seek personalized advice from qualified professionals regarding specific investment issues. Featured estimates are based on past market performance, and past performance is not a guarantee of future performance.
Our site doesn’t feature every company or financial product available on the market. We are compensated by our partners, which may influence which products we review and write about (and where those products appear on our site), but it in no way affects our recommendations or advice. Our editorials are grounded on independent research. Our partners cannot pay us to guarantee favorable reviews of their products or services.
We value your privacy. We work with trusted partners to provide relevant advertising based on information about your use of Joy Wallet’s and third-party websites and applications. This includes, but is not limited to, sharing information about your web browsing activities with Meta (Facebook) and Google. All of the web browsing information that is shared is anonymized. To learn more, click on our Privacy Policy link.
Images appearing across JoyWallet are courtesy of shutterstock.com.
Writer
Aaron Crowe is a freelance journalist who specializes in personal finance writing and editing. He has worked at newspapers, where he won a Pulitzer Prize, and has written for numerous online publications. These include AOL, US News & World Report, WiseBread, Bankrate, AARP, and many websites focusing on housing, credit and insurance. He lives in California with his wife and daughter.
Share this article
