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StockCram is not a broker-dealer, investment adviser, or financial institution. All content is for educational and informational purposes only and should not be construed as personalized investment advice. Consult a qualified financial professional before making investment decisions. Past performance does not guarantee future results.Simple Definition
An analyst's prediction of where a stock price will be in the future.
Why It Matters
When Goldman Sachs raises their Apple price target from $200 to $250, the stock often jumps. Price targets from major banks move markets. But take them with a grain of salt - analysts are often wrong, and their firms may have conflicts of interest. The 'average price target' across all analysts is more useful than any single prediction.
Key Points
- Price targets typically represent 12-month expectations
- Analysts covering a stock rarely issue 'sell' ratings due to conflicts of interest
- A stock trading well below its average price target might be seen as undervalued (or analysts might be wrong)
Related Terms
Common Questions
An analyst's prediction of where a stock price will be in the future. When Goldman Sachs raises their Apple price target from $200 to $250, the stock often jumps. Price targets from major banks move markets.
When Goldman Sachs raises their Apple price target from $200 to $250, the stock often jumps. Price targets from major banks move markets. But take them with a grain of salt - analysts are often wrong, and their firms may have conflicts of interest. The 'average price target' across all analysts is more useful than any single prediction.
Price targets typically represent 12-month expectations
Analysts covering a stock rarely issue 'sell' ratings due to conflicts of interest
A stock trading well below its average price target might be seen as undervalued (or analysts might be wrong)