Glossary · Defined term
Price target
A price target is an analyst's forecast of a stock's price, usually 12 months out, based on earnings and valuation models.
Last updated Oct 2, 2026
What it means
A price target is an analyst's forecast of where a stock will trade, usually 12 months in the future. Analysts at banks and brokerages build valuation models from expected earnings, cash flows, and comparable companies, then publish a target alongside a rating such as buy, hold, or sell. Targets are estimates, not promises, and they are revised constantly as new information arrives.
The consensus price target, the average of all analysts covering a stock, is the figure most often quoted in financial media. Comparing the consensus to the current price shows whether Wall Street as a group sees upside or downside. Individual targets vary widely, though, and the spread between the highest and lowest can be enormous.
Price target changes move stocks because they signal shifting professional opinion. An upgrade with a raised target can lift a stock even on an otherwise quiet day, while a cut can trigger selling. Savvy investors treat targets as one input among many: analysts are often slow to turn negative on companies their firms do business with.
An example
For illustration, after a strong earnings report an analyst raises a price target from $60 to $75 and upgrades the stock to buy. The upgrade itself attracts buyers and the stock climbs 4% that day, partly on the report and partly on the raised expectations.