price-target-consensus

Price Target Consensus

Retrieve consensus price target metrics including average, median, high, and low targets using the Octagon MCP server.

Prerequisites

Ensure Octagon MCP is configured in your AI agent (Cursor, Claude Desktop, Windsurf, etc.). See references/mcp-setup.md for installation instructions.

Workflow

1. Identify the Stock

Determine the ticker symbol for the company you want to analyze (e.g., AAPL, MSFT, GOOGL).

2. Execute Query via Octagon MCP

Use the octagon-agent tool with a natural language prompt:

Retrieve consensus price targets for the stock symbol <TICKER>.

MCP Call Format:

{
  "server": "octagon-mcp",
  "toolName": "octagon-agent",
  "arguments": {
    "prompt": "Retrieve consensus price targets for the stock symbol AAPL."
  }
}

3. Expected Output

The agent returns consensus price target data:

Metric	Value
Consensus Target	$303.11
Median Target	$315.00
Target High	$350.00
Target Low	$220.00

Data Sources: octagon-stock-data-agent

4. Interpret Results

See references/interpreting-results.md for guidance on:

• Understanding consensus vs. median
• Analyzing the target range
• Calculating upside/downside
• Evaluating analyst agreement

Example Queries

Basic Query:

Retrieve consensus price targets for the stock symbol AAPL.

With Price Context:

What is the consensus price target for TSLA and how does it compare to current price?

Range Focus:

What are the highest and lowest analyst price targets for NVDA?

Comparison:

Compare consensus price targets for AAPL, MSFT, and GOOGL.

Upside Analysis:

What upside does the consensus target imply for AMZN?

Understanding the Metrics

Consensus Target

Aspect	Description
Definition	Average of all analyst targets
Calculation	Sum of targets / Number of analysts
Use	General market expectation
Limitation	Skewed by outliers

Median Target

Aspect	Description
Definition	Middle value of all targets
Calculation	50th percentile
Use	Central tendency, outlier-resistant
Advantage	Less affected by extremes

Target High

Aspect	Description
Definition	Most bullish analyst target
Represents	Best-case scenario
Use	Maximum upside potential
Caution	May be overly optimistic

Target Low

Aspect	Description
Definition	Most bearish analyst target
Represents	Worst-case scenario
Use	Downside risk assessment
Caution	May be overly pessimistic

Calculating Potential

Upside/Downside Formulas

Consensus Upside = (Consensus Target - Current Price) / Current Price × 100%
Maximum Upside = (Target High - Current Price) / Current Price × 100%
Downside Risk = (Target Low - Current Price) / Current Price × 100%

Example Calculations

If AAPL trades at $270.01:

Metric	Target	Potential
Consensus	$303.11	+12.3% upside
Median	$315.00	+16.7% upside
High	$350.00	+29.6% upside
Low	$220.00	-18.5% downside

Range Analysis

Spread Calculation

Range = Target High - Target Low
Spread % = Range / Consensus Target × 100%

Interpreting Spread

Spread %	Interpretation
<20%	Strong consensus
20-40%	Normal range
40-60%	Moderate disagreement
>60%	High uncertainty

Example Range Analysis

From AAPL data:

• High: $350.00
• Low: $220.00
• Range: $130.00
• Consensus: $303.11
• Spread: 42.9%

Interpretation: Moderate disagreement among analysts, with significant difference between bulls and bears.

Consensus vs. Median

When to Use Each

Scenario	Prefer
Normal distribution	Consensus (average)
Outliers present	Median
Skewed targets	Median
General expectation	Consensus

Identifying Skew

Condition	Indicates
Consensus > Median	Right skew (bullish outliers)
Consensus < Median	Left skew (bearish outliers)
Consensus ≈ Median	Symmetric distribution

Example

From AAPL data:

• Consensus: $303.11
• Median: $315.00
• Consensus < Median → Left skew (some bearish outliers pulling average down)

Bull vs. Bear Cases

Understanding Extremes

Target	Represents
High	Bull case assumptions
Low	Bear case assumptions
Gap	Range of outcomes

Scenario Analysis

Scenario	Assumptions
Bull Case	Strong growth, expanding margins, favorable macro
Base Case	Consensus expectations
Bear Case	Challenges, competition, risks materialize

Practical Applications

Investment Decision

Finding	Consideration
Price < Low Target	Potential deep value or concerns
Price near Consensus	Fairly valued
Price > High Target	Potentially overvalued

Risk Assessment

Metric	Use For
Downside to Low	Worst-case loss
Upside to High	Best-case gain
Risk/Reward	Low upside / High downside

Position Sizing

Consensus View	Position Approach
Strong upside, tight range	Larger position
Moderate upside, wide range	Standard position
Limited upside, wide range	Smaller position

Common Use Cases

Quick Valuation Check

Is AAPL fairly valued based on analyst targets?

Upside Screening

Which tech stocks have the highest consensus upside?

Risk Assessment

What's the downside risk to the lowest analyst target for TSLA?

Sentiment Check

How wide is the range between bull and bear cases for NVDA?

Analysis Tips

1. Compare to current price: Calculate actual upside/downside.

2. Use median when skewed: More reliable central tendency.

3. Analyze the range: Wide = uncertainty, tight = agreement.

4. Consider timing: Targets are typically 12-month forward.

5. Track changes: Rising consensus = improving sentiment.

6. Combine with fundamentals: Targets are opinions, verify with data.

Integration with Other Skills

Skill	Combined Use
stock-quote	Current price for potential calculation
price-target-summary	Historical target trends
analyst-estimates	Earnings behind the targets
financial-metrics-analysis	Fundamental validation