Class, if you're still wondering why the stocks that have been getting massacred lately are the ones that the analysts love (on the record, at least), spit out your bubblegum and go stand in the corner. On your head.

Then, when the bell rings, write on the blackboard: I WILL NEVER AGAIN FOR THE REST OF MY LIFE BUY A STOCK JUST BECAUSE OF AN ANALYST'S 'BUY' RECOMMENDATION! Write it until your hand is ready to fall off. Write it 3,000 times. Don't ever forget it. Ever.

The fact that 'pom-pom' stocks take the worst beating in a market meltdown is old news, but many still don't get it, even after the message was driven home with a sledgehammer a few years ago in the crash of the dot-com bubble.

Sadly, research, especially research by Wall Street's big-name brokerage houses, is still a laughingstock. Even New York State attorney general Eliot Spitzer's much-ballyhooed assault on the research industry and its penchant for conflicting research reports has failed to make a real difference.

Face it, class. Wall Street is Wall Street. Spitzer or no Spitzer, it ain't goin' to change. It's you, the retail investor, who has to change the way you view research recommendations. Which is to say, you ought to be reading them while standing on your head.

That's exactly what the contrarian investors are doing. Standing on their heads. Yup, Wall Street research is such a farce that bargain hunters now scan the market for stocks with multiple sell recommendations and search for short-selling opportunities in stocks loaded with buy recommendations.

Even after some U.S. brokerage firms have been disciplined with fines over tainted research and have promised to clean up their act, not much has changed. Equity research remains an oxymoron. The best sells are still buys and the best buys are still sells. In other words, you're likely better off with a portfolio with 10 stocks that have sell recommendations than one with 10 stocks with no sell recommendations.

Even an accounting-challenged company like Nortel Networks (TSX:NT) looks more appealing right now than a go-go stock like Google (Nasdaq:Goog). That's because the analysts told us so - with two sell recommendations on Nortel and no sell recommendations on Google.

According to a recent analysis by Zacks Investment Research for the Wall Street Journal on Wall Street research, stocks with large proportions of sell recommendations have performed better lately than those with no sell ratings, which only means the trend of stupid research is continuing.

Generally, Wall Street's cheerleading analysts close the barn door after the manure hits the fan (i.e. bad news). They won't yell sell until it's too late and some firms don't even have the guts to yell sell, resorting to ambiguous terms such as 'underperform.' Uranium giant Cameco (CCO) has been one of the hardest hit TSX stocks lately with a brisk selloff that slashed its market cap by 25 per cent. But don't say you weren't warned. Cameco has become a classic pom-pom stock. There are no sells on Cameco, only buys and holds, which, in the past five years has rung up a 12-fold increase.

During one of the market's worst weeks in years recently, the biggest bust on the New York Stock Exchange was Cash American International (CSH), which took a weekly 34 per cent hit. Should you be surprised? Not at all.

The writing was on the wall. Which is why all three analysts who cover this stock have buy recommendations on it.

The Zacks report on Wall Street research actually showed that stocks with sell recommendations have outperformed those with buy recommendations to even a greater degree lately than any time since the bursting of the bubble in 2000.

One of the most glaring examples of how you could have made a killing buying when Wall Street was saying sell, and selling when Wall Street was saying buy, is in the performance of Gateway, Inc. (NYSE:GTW).

At the beginning of last year, Gateway stock carried eight sells, six holds and no buys among 14 recommendations. Yet, by yearend, the stock the street hated (on the record) was up 31 per cent in a market that showed modest gains.

True to form, Wall Street analysts, typically late to the party, jumped on the Gateway bandwagon as the stock surged.

Retail investors, like sheep to the killing floor, jumped on the analyst bandwagon at the start of this year, just in time for the shares to take a 33-per-cent pounding in the first quarter.

But now, with three analysts turning up their noses at Gateway shares with sell calls (there are also four buys and five holds), the stock may once again be turning ripe for the picking.

Mention General Motors (TSX:GM) these days and most investors would turn up their noses in disgust. But there are eight compelling reasons to take a long, hard look at GM as its stock tanks.

Eight analysts hate the stock right now, giving it a sell recommendation, while only two analysts rate it a buy.

A contrarian's dream? Perhaps.

Eight sell recommendations?

That's ugly. That's beautiful. Which one?

Only a head-standing psychoanalyst knows for sure.

* SAGE WORDS: "In this market, we live and die by analysts. Too often die."

- David Dreman, Forbes columnist and author of Contrarian Investment Strategies: The Next Generation.

HOT STOCK: Nevarro Energy

COLD STOCK: Neurochem Inc.

(Gyle Konotopetz can be reached at gyle@businessedge.ca)