What does “hit the nail on the head” mean?

to say sth that is exactly right

How is “hit the nail on the head” used?

In The Life and Death of Colonel Blimp (1943), one line is: “She's hit the nail on the head.”

The clip at the top of this page is from The Life and Death of Colonel Blimp (1943).

She's hit the nail on the head.

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