An analyst will write reports on the companies they are supposed to cover, trying to describe the businesses and their opinion of the company's investment potential, usually from a fundamental analysis standpoint. They also summarize that report with a rating, such as "buy," "sell," "market perform," "overweight," "hold," etc.
The analysts get their information by studying public records of the company and by participating in public conference calls where they can ask direct questions to the management. Previously, analysts were said to obtain lots of information (especially from clients of their investment bank), via exclusive meetings with upper management. Regulation FD (Fair Disclosure), is said to prevent most of this from happening at present.
Financial analysts, also called securities analysts and investment analysts, work for banks, insurance companies, mutual and pension funds, securities firms, and other businesses, helping these companies or their clients make investment decisions. Financial analysts employed in commercial lending perform "balance sheet analysis," examining the audited financial statements and corollary data in order to assess lending risks.
Financial analysts use spreadsheet and statistical software packages to analyze financial data, spot trends, and develop forecasts. On the basis of their results, they write reports and make presentations, usually making recommendations to buy or sell a particular investment or security. They must keep abreast of new regulations or policies that may affect the industry, as well as monitor the economy to determine its effect on earnings.
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