Glossary
Price target
An analyst’s estimate of where a stock’s price could be at a future date, usually about 12 months ahead.
A price target comes from an analyst’s model, often built on forecasts of earnings or cash flow and an assumed valuation multiple. Change the assumptions and the target changes, which is why targets are revised often.
Different analysts covering the same company can publish very different targets. Data providers summarize them as a consensus, usually an average or median, alongside the highest and lowest.
The gap between a target and the current price is called implied upside or downside. It is an estimate under stated assumptions, not a forecast that the price will get there.
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