The price target says buy. The valuation says wait.

An analyst price target is a forecast of where a share price will be in about twelve months. A fair-value estimate is a calculation of what the business is worth today, on filed numbers and stated assumptions. The first is a bet on the price; the second is a yardstick for it. They are built from different things, they answer different questions, and they can point in opposite directions for years without either being wrong on its own terms.

That is the whole difference, and it fits in a paragraph. The reason it deserves a post is that the two numbers sit on the same company page, in the same font, and one of them moves with the price while the other does not. For four and a half years, from March 2022 to this month, Nike's consensus target sat above the price in nearly every month while the shares lost three quarters of their value. What follows is that table, month by month, and what a valuation would have said at the start of it.

What each number is made of

Think of selling a house. The estate agent says "you will get 480 for this", and that number is built from what buyers are paying this month, how the street is moving, and a feel for how the next six weeks will go. The surveyor's report says what the building is worth given its size, condition and the sales on record, and it says nothing about next month. Both are useful. You would not confuse them, because they come on different letterheads.

A price target is the estate agent. Underneath it are two forecasts: what the company will earn next year, and what multiple of those earnings the market will be willing to pay at that point. Multiply the two and you have a target. Change either and the target moves, which is why it gets revised after every set of results and, as the table below shows, after every large move in the price.

A fair-value estimate is the surveyor. It starts from the numbers the company has filed, applies a method that is written down, and produces a value for the business as it is. It does not say when the price will get there, or whether it will. Our own methods are on the fair-value page, with the inputs shown on every company page, and I am not going to define fair value a second time here. The point of this post is the gap between the two numbers, not either number on its own.

Nike, month by month

Our table of analyst targets holds a monthly consensus point for Nike going back to 2021. I took every month-end from March 2022 to September 2025 where at least five analysts stood behind the average, put the share price of that day next to it, and then the price twelve months later. The full run is 27 month-ends; here are the ones a reader can check against a calendar.

Across the 27 month-ends: the target sat at least 10% above the price in 22 of them. The price reached the target within the following year in none of them. It was lower a year later in 24. The average promised upside was 21%; the average realised change was minus 17%. At the end of August 2026, with 25 analysts in the average, the target was $50.05 against a price of $39.60, 26% above it. The shares closed at $36.22 on 15 September.

I want to be careful about what this table shows, because it is one company and it is a company that had a bad four years. It does not show that analysts are fools. Most of them knew Nike better than I do. It shows the shape of the instrument: a twelve-month price forecast, re-based to the current price every time the price moves, so that "26% above" is roughly where it lives whatever the price happens to be. The target for Nike fell from $168 to $151 to $136 to $111 to $98 to $85 to $50. Each step came with or after a step in the price, never before one. A number that follows the price down cannot also be the number that warns you the price is going to fall. That is not a flaw in the analysts. It is what a target is for.

What a valuation said in March 2022

Now the surveyor's letter, dated the same day, and I will label every assumption because this is my arithmetic, not a line from our product.

On 31 March 2022 the last annual report Nike had filed was for the year to May 2021 (filed 20 July 2021): diluted earnings of $3.56 a share. At $133.70 the shares were priced at 37.6 times those earnings. Over the previous ten filings, from the year to May 2012 to the year to May 2021, the multiple on the day each annual report arrived had a median of about 28.6 times. Price $3.56 of filed earnings at Nike's own ten-year median and you get roughly $102.

So the yardstick said the price was about 30% above what the company's own history would pay for the earnings it had actually filed. The target, at $168, was 47 times those earnings. For the target to be right, two things had to happen at once: earnings had to grow well beyond $3.56, and the market had to keep paying more than 40 times for them a year later.

What was filed afterwards: $3.75 for the year to May 2022, $3.23 for 2023, $3.73 for 2024, $2.16 for 2025, and $2.10 for the year to May 2026 (Nike's results release of 30 June 2026). Earnings did not grow. The multiple came down to somewhere between 19 and 34 times on filing days. Both forecasts inside the target failed, and the target was re-issued lower each time, still above the price.

Two things the valuation did not say. It did not say sell, or short: a business trading above its own historical multiple is usually one the market expects to grow, and the market is often right about that, which is the subject of the value trap post read in the other direction. And it did not say when. A year after that letter the price was $122.64, still 20% above the $102, and anyone who acted on the yardstick as a timing signal spent that year looking wrong. "Wait" is not a timing call. It is a statement that the price already contains growth that has not been filed yet, and that you are being asked to pay for it in advance.

Why the target follows the price

None of this is a conspiracy, and it helps to see the mechanism, because then you stop expecting the number to do something it cannot.

A target is published with a twelve-month horizon and is meant to be plausible on the day it is published. If the price halves, a target that was 40% above the old price is now 180% above the new one, which nobody would put their name to, so it is cut. The earnings forecast underneath it is usually cut at the same time, because the same news that moved the price changed the outlook. And the consensus is an average of whichever targets were published in the period, so how many analysts stand behind it depends on who published when, which is why the count in our table swings between one and twenty-five from one month to the next.

The result is a number that is anchored to the present. It tells you what the people paid to follow the company think is a reasonable price a year out, given everything the price already says. That is useful, especially the spread between the highest and lowest target, which tells you how much they disagree. It is not a valuation, and reading it as one is how a 26% "upside" sits on a page for four years while the price drops 73%.

Reading the two together

Put the two numbers side by side and there are four cases.

Target above the price, value above the price. Both instruments say the same thing, and the question is why the market disagrees with both. Usually there is a reason on the balance sheet or in the last filing, and it is worth finding before believing two numbers that were partly built from the same optimism.

Target above, value below. The common case, and the title of this post. The price already contains growth. The target says the growth will show up; the value says it has not been filed yet. Nothing here says the growth will not come. It says you are paying for it before it exists, and you should know that is the bet.

Target below, value above. Rare, and the interesting one. The people following the company expect the price to fall further, and the filed numbers say the business is worth more than that. Sometimes that is a value trap in the making, where the filed earnings are about to stop existing. Sometimes it is the market giving up on a business that is fine. The difference is in the working capital and the cash flow, not in either number.

Both below. The price has run ahead of both the business and the forecasts. Wait, and this time both instruments agree.

None of the four is an instruction. They are two letters on two letterheads, and the work is reading which one is answering the question you actually have. If you own the company for the next ten years, the surveyor's letter is the one that matters and the estate agent's is noise. If you are deciding whether to buy this quarter, the agent's letter tells you what everyone else already expects, which is worth knowing precisely because it is already in the price.

What we show, and what we do not

On a company page we show the Wall Street consensus target with the number of analysts behind it and the date it was last updated, and we show our fair value with the method that produced it and the inputs, each input dated to its filing. They sit in different sections with different labels, because they are different things. We do not show a target of our own. Forecasting next year's price is not something we do, and the one place we say what we expect, the Monthly Top 10, comes with the thesis and the risks written down first.

If you want to see both numbers for a company you hold, the sample report shows the whole thing for Amazon, and the Stock Deep Dive sends the same for one stock of your choosing, as a PDF by email, usually within minutes. No card, one per person.

Sources for the figures above: Nike's monthly consensus targets and the analyst counts are the month-end points in our analyst-target table, fed today from Nasdaq's analyst data, read on 17 September 2026; prices are our daily price table for the same dates; earnings per share are from Nike's annual reports by filing date, and the year to May 2026 from Nike's results release of 30 June 2026. The 28.6 times median and the $102 are my arithmetic on those filed numbers, with the assumption stated.

Educational and proprietary. This explains what our research does, not the exact formula behind it, and it is not personalised investment advice. See the full disclaimer.