Analyst Earnings Estimate Accuracy
Last Updated: November 16, 2009
Text Size: A A A

Save to My Help

Save this article to My Help for easy reference. You can visit the article at any time from any computer.

Replace an article

You have reached the maximum number of saved articles. Your oldest saved article will be replaced with the new one.

When you’re researching stocks and other securities to add to your portfolios, one of the most important factors to consider is how well financial analysts who study specific securities expect them to perform in the near future and beyond. But some analysts’ estimates of stock performance are consistently more accurate than others. That’s why it’s so crucial to find one or more analysts with high accuracy ratings who specialize in the industry or company in which you plan to invest.

The Earnings Estimate Accuracy Rating represents a proprietary metric for earnings estimate accuracy known as the Relative Accuracy Score (RAS). It’s a measurement developed by investment research analysis firm StarMine, which analyzes every earnings estimate and revision published by thousands of financial analysts around the world. A relative measure, RAS compares an analyst's performance with other similar analysts. To get a high score, an analyst must make estimates that are both significantly different from, and more accurate than, other analysts' estimates.

RAS takes into account many factors, including the analyst's absolute earnings forecast error, that error compared to the forecast of other analysts, the variance of the errors, the timing of each revision, and the absolute value of the stock's actual reported earnings. StarMine computes RAS daily for an analyst's overall score on individual stocks and groups of stocks.

StarMine then ranks analysts according to the following RAS ratings:

  • Analysts who score in the top 10% earn 5 stars
  • The next 22.5% earn 4 stars
  • The next 35% earn 3 stars
  • The next 22.5% earn 2 stars
  • The bottom 10% earn 1 star

An alphabetical list of all analysts can be found on the Yahoo! Finance Analyst Performance Center page (under Browse Ratings, click By Analyst). To filter your search, you can browse by company/stock, research firm, or industry.

Analyst ratings

If you want to find top research analysts for another stock, you can type the company/stock name in the Get Star Analysts for box in the upper-right corner of the page and click GO. The top-scoring analysts, those who earned RAS scores of 4 or 5 stars, are displayed with their ratings just below that box. Listed below them, under the heading "Other Ranked Analysts," are lower-performing analysts whose RAS scores are 1, 2, or 3 stars (unlike star analyst ratings, their scores don’t appear after their names). The star analysts shown below all have 4-star RAS ratings.

Ranked analysts

Was this information helpful?      

My Help

Forgot your ID or password?

Sign In

Sign in to see your account information saved articles and more.
  1. Recent Searches

  2. Saved Articles

    Sign in to see your account information saved articles and more.

Similar Topics

Still Need Help?

Top Questions

More Help Links