– Glossary

Consensus estimate

When a stock reports earnings each quarter, the analysts who follow that stock will each have their own earnings estimate for the company\'s quarterly results. The average of all these forecasts is known as the consensus estimate. Actual earnings that come in above the consensus estimate are considered a positive earnings surprise. Earnings that are below the estimate are considered negative surprises. The stock\'s reaction to these earnings announcements typically confirms whether expectations were high or low heading into the earnings report.

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