Consensus Estimate
The consensus estimate is the average (or median) of the forecasts that sell-side analysts covering a company have made for metrics such as revenue and EPS. The market uses it as the baseline for deciding whether a report was "good."
How to read it
The stock is already priced off the consensus before the report comes out, so what actually moves it is the gap between the actual result and the estimate, not how high or low the actual result is on its own.
Estimates are not fixed. Analysts keep adjusting them in the weeks before a report, and the direction of those revisions (up or down) is a signal in itself.
Different data vendors count different sets of analysts, so consensus figures vary slightly from source to source. A difference of a few cents is normal.
Common pitfalls
- There is also an unpublished "whisper number" in the market: for popular companies, real expectations often sit above the published consensus, and a stock can fall even when the company just meets the official bar.
On FinDog
The Earnings Calendar shows each company's consensus EPS estimate ahead of its report, and the scorecard in each earnings analysis puts the actual figure side by side with the estimate. Estimate data comes from Finnhub.
See the Earnings Calendar →Related terms
- Earnings Beat / MissWhen reported revenue or EPS comes in above the consensus estimate it is a beat; below is a miss; roughly equal is in line. The difference expressed as a percentage of the estimate is called the surprise.
- Earnings Per Share (EPS)Earnings per share is net income divided by shares outstanding: how much profit each share earned during the period. It is the most closely watched number in any earnings report, and it is also the denominator of the P/E ratio.
- GuidanceGuidance is management's forecast for next quarter's or the full year's revenue, margins, EPS and similar metrics, usually given as a range. It is one of the parts of an earnings report that moves the stock the most.