What is the StarMine SmartEstimate and Predicted Surprise on the Fundamentals > Earnings/Dividends page and how should I use it?
Many investors use the simple average of analyst estimates, often referred to as the consensus or mean, to predict a stock’s earnings or revenue. Using a mean places equal weight on each analyst’s estimate, regardless of whether the estimate was issued 2 or 200 days ago, and regardless of whether the analyst is more or less accurate in covering a stock/sector. StarMine goes further by first calculating how accurate an analyst is and how timely his or her estimates are, and second by putting more weight on the most recent estimates from the most accurate analysts. These factors can make the StarMine SmartEstimate more accurate than the consensus. For example, if the earnings mean states $1.00 and the SmartEstimate states $1.10, StarMine expects other analysts to revise towards $1.10 or the company to report an earnings surprise. Estimate revisions usually tend to trigger future estimate revisions; therefore, a higher StarMine SmartEstimate is indicating that the stock is more likely to
