Analysts also have an embarrassing track record when it comes to target prices. As Ben Graham said, “Forecasting security prices is not properly a part of security analysis, ” but that doesn’t stop the analysts from coming up with daft guesses as to the future price of a stock. On average these targets are about 25 percent higher than the current price. However, they are worthless as forecasts. For instance, in 2000 the average target price of stocks was some 37 percent above the market price at the start of the year. The actual outcome was that they were up 16 percent. In 2008, the analysts
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