"X beats Y's target" makes sense to me due to the nature of the stock market, and how expectations are "baked into" the share price. Quarterly earnings are all

"X beats Y's target" makes sense to me due to the nature of the stock market, and how expectations are "baked into" the share price. Quarterly earnings are all about performance relative to expectation, while it is accurate to say that the analysts are wrong in this instance, the market gives so much "trust" to analysts that we expect their targets to be expressed in good faith (I sense an SEC violation otherwise), so when a company beats expectations we view that as a decent proxy for performance.