The problem with analysts’ target prices

The sell side analyst’s target prices do not estimate fair value. DCF estimates do just that. Investors should not confuse the two.
The sell side analyst’s target prices do not estimate fair value. DCF estimates do just that. Investors should not confuse the two.
Even with overly optimistic earnings estimates companies regularly ‘beat’ the estimates. What gives?
Since analysts’ reports are so important in our work of identifying and studying companies to invest in, we need to look at the strengths and weaknesses of these reports.