Here's Why Wall Street Analysts Hate Rating Stocks With A 'Sell' Rating

As an example, analysts who want Coach Inc COH's top executives to attend private events with investor clients need to present themselves as "brand ambassadors." However, rating Coach's stock as Sell will automatically strip the analysts of the "brand ambassador" title, and they can forget about having access to Coach's management team.

In fact, Wall Street analysts are compensated in part on their ability to organize these investor meetings with top members of an executive team. The report further suggested that among the thousands of analyst recommendations across S&P 500 companies, just 6 percent are either Sell or Underweight.

CNBC took a deep dive into the report and came up with some interesting findings.

What We Know About The 4-Letter S Word

Sell ratings actually peaked back in 2003 when a new rule by the National Association of Securities Dealers required analyst firms to break down their ratings as a percentage of Buy, Hold and Sell.

The percentage of ratings among S&P 500 companies that are Sell or Underweight has never broken above 10 percent and has hovered around 5 percent over the past decade.

Meanwhile, the percentage of bullish ratings have remained nearly flat at 50 percent over the past decade.

Investors who have also been wondering if there is a difference between a Sell rating or an Underperform rating the short answer is not really.

"Many firms took the easy way out so they don't offend anyone," David Nelson, chief strategist at Belpointe Asset Management told CNBC. "Morgan Stanley long ago went to 'Overweight,' 'Equal Weight' and 'Underweight' format to avoid calling a stock a sell."