Analysts Anticipate The First Trust Dow Jones Internet Index Fund ETF Will Reach $161

Looking at the underlying holdings of the ETFs in our coverage universe at ETF Channel, we have compared the trading price of each holding against the average analyst 12-month forward target price, and computed the weighted average implied analyst target price for the ETF itself. For the First Trust Dow Jones Internet Index Fund ETF, we found that the implied analyst target price for the ETF based upon its underlying holdings is $161.49 per unit.

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With FDN trading at a recent price near $144.08 per unit, that means that analysts see 12.08% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of FDN’s underlying holdings with notable upside to their analyst target prices are Dropbox, Etsy and Veeva Systems. Although DBX has traded at a recent price of $17.82/share, the average analyst target is 55.72% higher at $27.75/share. Similarly, ETSY has 39.92% upside from the recent share price of $46.13 if the average analyst target price of $64.55/share is reached, and analysts on average are expecting VEEV to reach a target price of $178.93/share, which is 22.97% above the recent price of $145.51. Below is a twelve month price history chart comparing the stock performance of DBX, ETSY, and VEEV:

Combined, DBX, ETSY, and VEEV represent 5.18% of the First Trust Dow Jones Internet Index Fund ETF.

Do the analysts have a valid justification for their targets, or are they behind the curve on recent company and industry developments? A high price target relative to a stock’s trading price can reflect optimism about the future, but can also be a precursor to target price downgrades if the targets were a relic of the past. These are questions that require further investor research.

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