By tapping into a wider range of contributors including hedge-fund analysts, asset managers, independent research shops, students, and non professional investors Estimize has created a data set that is more accurate than Wall Street up to 69.5% of the time.
More importantly, Estimize does a better job of representing the market's actual expectations, according to Deutsche Bank Quantitative Research and an independent academic study from Rice University. Stock prices tend to react more closely to the Estimize benchmark expectations than to the Wall Street consensus.
The magnitude of the difference between the Wall Street and Estimize consensus numbers often identifies opportunities to take advantage of expectations that may not have been priced into the market.
In this case the stock is in the middle of a selling frenzy, but we are seeing a large and positive difference between the earnings expectations from Estimize and Wall Street.
The distribution of estimates by analysts on the Estimize.com platform range from 4 cents to 42 cents per share in earnings, and from $590 million to $874 million in revenue. This quarter we're seeing a moderate to wide range of estimates on Tesla compared to previous quarters.
The size of the distribution of estimates relative to previous quarters often signals whether or not the market is confident that it has priced in the expected earnings already. A wider distribution of EPS estimates signals less agreement in the market, which could mean greater volatility post-earnings.