Consensus Estimate
Quick Definition
The average of analyst forecasts for a company's earnings, revenue, or other financial metric.
Key Takeaways
- Consensus estimates average multiple analyst forecasts for earnings or revenue.
- Beating consensus often lifts a stock; missing it usually causes a decline.
- Data providers aggregate estimates, but the "whisper number" can differ from published consensus.
What Is Consensus Estimate?
A consensus estimate is the combined average (or median) of financial forecasts made by sell-side analysts covering a particular stock. The most common consensus figures are earnings per share (EPS), revenue, and EBITDA for upcoming quarters or fiscal years. When a company reports results that beat the consensus, its stock often rises; missing the consensus typically triggers a sell-off. Consensus estimates are compiled by data providers like Refinitiv (IBES), Bloomberg, and FactSet by aggregating individual analyst models. The "whisper number"—an unofficial expectation circulating among traders—can differ from the published consensus. Investors should note that consensus estimates reflect Wall Street expectations, not guarantees, and can shift rapidly as analysts revise models after company guidance or macro developments.
Consensus Estimate Example
- 1Analysts had a consensus EPS estimate of $1.45 for Q4; the company reported $1.52, beating by $0.07.
- 2Revenue consensus for Amazon was $148B; the actual figure of $143B caused a 5% after-hours drop.
Related Terms
Analyst Rating
A professional securities analyst's recommendation on whether to buy, hold, or sell a particular stock, typically issued by investment banks and research firms.
Revenue
The total amount of money a company earns from its business activities before any expenses are deducted, also called sales or top line.
Earnings Surprise
The difference between a company's actual reported earnings and the analyst consensus estimate.
Stock
A security representing ownership in a corporation, entitling the holder to a share of profits and voting rights.
Initial Public Offering (IPO)
The first sale of a company's stock to the public, transitioning it from private to publicly traded.
NASDAQ
The National Association of Securities Dealers Automated Quotations — the second-largest stock exchange globally, known for its concentration of technology and growth companies.
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