The Forecaster Scoring is calculated based on consensus recommendations from analysts. Each recommendation is assigned a specific point value:
- Strong Buy: 1 point
- Buy: 2 points
- Hold: 3 points
- Sell: 4 points
- Strong Sell: 5 points
The weighted average is then calculated using these point values. For example, let's say a company has the following consensus recommendations from 32 analysts:
- Strong Buy: 13
- Buy: 6
- Hold: 3
- Sell: 2
- Strong Sell: 8
The weighted average for the company would be calculated as follows:
Weighted Average = [(13 × 1) + (6 × 2) + (3 × 3) + (2 × 4) + (8 × 5)] / 32 = 2.5625
This score would then fall within the "Hold" range based on the scoring scale.