Brokerage houses often have huge teams of analysts who will be analyzing the stocks in different sectors. The analysis that these teams produce are released periodically, with the intention of attracting people to use the brokerage and therefore generate revenue. The pieces of analysis often come with a Buy, Sell or Hold recommendation and some times a target price.
Analysts predictions are based on several different factors including profit and cash flow figures, opinions on long term prospects of the company, whether the company is valued or undervalued and how it is valued in comparison to other companies in the sector. In the past this kind of analysis used to be only available to institutional clients. Recently this has changed and there are several websites that provide this kind of research either for free or for a small fee. It is also sometimes the case that Spread Betting companies offer the kind of research that is only normally available to institutions.
The other thing to look out for if you cant get hold of proper research is consensus forecasts which are normally easy to find online. These are collated from the forecasts of individual analysts and are often considered more reliable than individual forecasts. The idea is if that many people are recommending a stock then it might be a good idea to buy such a stock, though be warned it may not always go the way the analysts predict. These consensus forecasts are reported online as well as often found in investor magazines.
Part of the Beginners Guide to Strategy and Analysis for Spread Betting