Definition of orphan stock

stock that has been neglected by research analysts. Since the company's story is rarely followed and the stock infrequently recommended, it is considered an orphan by investors. Orphan stocks may not attract much attention because they are too small, or because they have disappointed investors in the past. Because they are followed by so few investors, orphan stocks tend to trade at low price/earnings ratios. However, if the company assembles a solid record of rising profitability, it can be discovered again by research analysts, boosting the stock price and price/earnings ratio significantly. Investors who buy the stock when it is still a neglected orphan can thereby earn high returns. Also called a wallflower.