The Wall Street analysts seem bullish and have given a mean target price for TAL Education's (TAL, Financial) stock at $15, estimating a 38.1% potential for the company's shares. Although TAL Education traded nearly flat at $10.98 for the last trading session, this target is sharply higher, with the highest analyst target implying the stock could reach as high as $17 and represent a 54.8% upside.
This consensus is primarily on the stock's growth prospects, although much attention is usually given to analysts' price target forecasting, which is usually perceived as a reckless guess. These estimates exist based on theoretical and practical data related to corporate earnings and global tendencies. At the same time, some concerns about their optimism stem from the fact that analysts have a business relationship with the companies they analyze through their firms. This comes with some danger of conflict of interest that may lead to the setting of high targets.
However, the analysts' estimates' continuity is by far impressive. The low standard deviation of $2.28 implies that the majority of the analysts agree on the possible direction of TAL Education's stock price. The report may also be effective as a source of reference for potential investors as it goes beyond simple price predictions to present a range of analysis techniques and business performance indicators.
Although price targets may be helpful for investors, literary analysis suggests that it is essential not to put too much stock in such targets because they do not always reflect prices in the following periods. For TAL Education, as Wall Street may find near-term prospects easily in the TAL Education stock, they should go deeper and evaluate whether the estimates are fair in analyzing the TAL Education stock in light of the rather extraordinary and delicate factors that come into play in the Chinese market.
