Firm Specific Information Environment And Analyst Forecast

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Firm-specific Information Environment and Analyst Forecast

Author : Wei Hsu (Ph.D.)
Publisher :
ISBN 13 :
Total Pages : 84 pages
Book Rating : 4.:/5 (132 download)

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Book Synopsis Firm-specific Information Environment and Analyst Forecast by : Wei Hsu (Ph.D.)

Download or read book Firm-specific Information Environment and Analyst Forecast written by Wei Hsu (Ph.D.) and published by . This book was released on 2019 with total page 84 pages. Available in PDF, EPUB and Kindle. Book excerpt: I examine how firm-specific private and public information affect analyst forecast revisions. I find that when managers easily beat (struggle to meet) the consensus forecasts in the previous quarter, financial analysts revise their earnings forecasts upward (downward). The revision magnitudes are higher when there is more private information. Similarly, I find that when managers provide upward (downward) earnings guidance, analysts revise their forecasts upward (downward) more when there is more private information. In contrast, the revision magnitudes are lower when there is more public information. Additionally, I find that the magnitudes of analysts' downward revisions increase with private information prior to the stock option grant dates. I attribute these results to the analysts' dependence on managers in gleaning relevant private information. The effect of private information is smaller for firms covered by star analysts, consistent with star analysts acting as sophisticated skeptics and being more confident in their forecasts than other analysts. Further, for well-governed firms, upward revisions for positive earnings surprises are smaller when there is more private information. This is consistent with stronger governance attenuating analysts' concerns about firms' earnings quality, which in turn increases their reliance on public earnings numbers and reduces their need to accommodate managers for private information. Finally, I find that private information is negatively associated with target price forecast accuracy, and positively associated with target price forecast optimism. These results suggest that greater information asymmetry adversely affects forecast accuracy and creates incentives for analysts to appease managers to access private information.

The Speed With Which Analysts Incorporate Firm-Specific and Industry Information in Their Forecasts

Author : Sami Keskek
Publisher :
ISBN 13 :
Total Pages : 45 pages
Book Rating : 4.:/5 (13 download)

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Book Synopsis The Speed With Which Analysts Incorporate Firm-Specific and Industry Information in Their Forecasts by : Sami Keskek

Download or read book The Speed With Which Analysts Incorporate Firm-Specific and Industry Information in Their Forecasts written by Sami Keskek and published by . This book was released on 2019 with total page 45 pages. Available in PDF, EPUB and Kindle. Book excerpt: We separate analyst forecast revisions into components representing industry-wide and firm-specific news. Using the relation between analyst forecast revisions and upcoming news to estimate how completely analysts incorporate their private information in their forecasts, we show that analysts incorporate a smaller proportion of industry-wide news than firm-specific news in their forecasts, particularly when the underlying news is bad. Post-forecast-revision drift is strongly associated with the private industry-wide information that analysts withhold from their forecast revisions. Furthermore, analysts' information withholding varies predictably with their incentives. Unlike prior research that attributes post-forecast revision drift to delayed market response to news in forecast revisions, our findings suggest that the drift arises because investors are unable to anticipate the news that analysts withhold from their forecast revisions. Our study sheds light on analysts' role in conveying firm-specific and industry-wide news to investors and on the implications for post-forecast-revision drift.

Earnings Expectations

Author : William Kross
Publisher :
ISBN 13 :
Total Pages : 64 pages
Book Rating : 4.3/5 ( download)

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Book Synopsis Earnings Expectations by : William Kross

Download or read book Earnings Expectations written by William Kross and published by . This book was released on 1987 with total page 64 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Capitalizing China

Author : Joseph P. H. Fan
Publisher : University of Chicago Press
ISBN 13 : 0226237249
Total Pages : 401 pages
Book Rating : 4.2/5 (262 download)

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Book Synopsis Capitalizing China by : Joseph P. H. Fan

Download or read book Capitalizing China written by Joseph P. H. Fan and published by University of Chicago Press. This book was released on 2013 with total page 401 pages. Available in PDF, EPUB and Kindle. Book excerpt: La 4e de couverture indique : "Despite a vast accumulation of private capital, China is not embracing capitalism. Deceptively familiar capitalist features disguise the profoundly unfamiliar foundations of "market socialism with Chinese characteristics." The Chinese Communist Party (CCP), by controlling the career advancement of all senior personnel in all regulatory agencies, all state-owned enterprises (SOEs), and virtually all major financial institutions state-owned enterprises (SOEs), and senior Party positions in all but the smallest non-SOE enterprises, retains sole possession of Lenin's Commanding Heights. The chapters in this volume examine China's high savings rate, banking system, financial markets, financial regulations, corporate governance, and public finances; and consider policy alternatives the CCP might consider if its goal is China's elevation into the ranks of high income countries."

The Informational Role of Sell-side Analysts' Forecast Horizon

Author : Xuan Wang
Publisher :
ISBN 13 : 9781085656627
Total Pages : 90 pages
Book Rating : 4.6/5 (566 download)

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Book Synopsis The Informational Role of Sell-side Analysts' Forecast Horizon by : Xuan Wang

Download or read book The Informational Role of Sell-side Analysts' Forecast Horizon written by Xuan Wang and published by . This book was released on 2019 with total page 90 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation explores the informational role of sell-side analysts' change in forecasting horizon. I find that portfolios formed by buying stocks with large increase in analyst horizon and shorting stocks with large decrease in analyst horizon generate superior future return. Horizon change has information incremental to analyst earnings forecast and recommendation revisions, as well as firm fundamentals. Large increase in horizon mainly drives the result. I find that analysts who contribute to strong horizon increase are associated with higher forecast accuracy. This increase is likely associated with the career concerns of inexperienced analysts. The return predictability associated with analyst forecast horizon change exists in the information environment of high liquidity and low volatility, at the times when analyst forecasts are the most accurate. Moreover, analyst forecast horizon is partially related to analysts' profitability prediction and firm risk assessment, although the horizon change, the component predictable by firm fundamentals notwithstanding, is still able to predict return in the short-run. Overall, the findings reported in this dissertation support the view that sell-side analysts are important rational-information providers in the financial industry.

Handbook Of Financial Econometrics, Mathematics, Statistics, And Machine Learning (In 4 Volumes)

Author : Cheng Few Lee
Publisher : World Scientific
ISBN 13 : 9811202400
Total Pages : 5053 pages
Book Rating : 4.8/5 (112 download)

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Book Synopsis Handbook Of Financial Econometrics, Mathematics, Statistics, And Machine Learning (In 4 Volumes) by : Cheng Few Lee

Download or read book Handbook Of Financial Econometrics, Mathematics, Statistics, And Machine Learning (In 4 Volumes) written by Cheng Few Lee and published by World Scientific. This book was released on 2020-07-30 with total page 5053 pages. Available in PDF, EPUB and Kindle. Book excerpt: This four-volume handbook covers important concepts and tools used in the fields of financial econometrics, mathematics, statistics, and machine learning. Econometric methods have been applied in asset pricing, corporate finance, international finance, options and futures, risk management, and in stress testing for financial institutions. This handbook discusses a variety of econometric methods, including single equation multiple regression, simultaneous equation regression, and panel data analysis, among others. It also covers statistical distributions, such as the binomial and log normal distributions, in light of their applications to portfolio theory and asset management in addition to their use in research regarding options and futures contracts.In both theory and methodology, we need to rely upon mathematics, which includes linear algebra, geometry, differential equations, Stochastic differential equation (Ito calculus), optimization, constrained optimization, and others. These forms of mathematics have been used to derive capital market line, security market line (capital asset pricing model), option pricing model, portfolio analysis, and others.In recent times, an increased importance has been given to computer technology in financial research. Different computer languages and programming techniques are important tools for empirical research in finance. Hence, simulation, machine learning, big data, and financial payments are explored in this handbook.Led by Distinguished Professor Cheng Few Lee from Rutgers University, this multi-volume work integrates theoretical, methodological, and practical issues based on his years of academic and industry experience.

Essays on the Economic Consequences of Mandatory IFRS Reporting around the world

Author : Ulf Brüggemann
Publisher : Springer Science & Business Media
ISBN 13 : 3834969524
Total Pages : 162 pages
Book Rating : 4.8/5 (349 download)

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Book Synopsis Essays on the Economic Consequences of Mandatory IFRS Reporting around the world by : Ulf Brüggemann

Download or read book Essays on the Economic Consequences of Mandatory IFRS Reporting around the world written by Ulf Brüggemann and published by Springer Science & Business Media. This book was released on 2011-08-31 with total page 162 pages. Available in PDF, EPUB and Kindle. Book excerpt: Ulf Brüggemann discusses and empirically investigates the economic consequences of mandatory switch to IFRS. He provides evidence that cross-border investments by individual investors increased following the introduction of IFRS.

International Differences in Analyst Forecast Properties

Author : James S. Ang
Publisher :
ISBN 13 :
Total Pages : 57 pages
Book Rating : 4.:/5 (129 download)

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Book Synopsis International Differences in Analyst Forecast Properties by : James S. Ang

Download or read book International Differences in Analyst Forecast Properties written by James S. Ang and published by . This book was released on 2001 with total page 57 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines international differences in analyst forecast properties using 42 countries. Properties of the forecasts, specifically dispersion and error, are hypothesized to be a function of country-specific, firm-specific, and discretionary components, the latter component including analyst bias and management manipulation of their firm's information environment. The results suggest that country-specific (e.g., corporate governance structures) and firm-specific (e.g., size) components help determine dispersion and error. The most important component, however, appears to be the discretionary component, as analyzed by profitability. Firms with losses are associated with significantly higher dispersion and error and overwhelming percentages of forecast optimism.

Economic Effects of Transparency in International Equity Markets

Author : Mark Lang
Publisher : Now Publishers Inc
ISBN 13 : 1601984480
Total Pages : 79 pages
Book Rating : 4.6/5 (19 download)

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Book Synopsis Economic Effects of Transparency in International Equity Markets by : Mark Lang

Download or read book Economic Effects of Transparency in International Equity Markets written by Mark Lang and published by Now Publishers Inc. This book was released on 2011 with total page 79 pages. Available in PDF, EPUB and Kindle. Book excerpt: This monograph reviews the existing accounting, finance and economics literature on the economic effects of transparency in international equity markets, considers aspects of an international setting that make it an interesting environment for investigating these effects, and suggests directions for future research

Analysts, Taxes, and the Information Environment

Author : Sangwan Kim
Publisher :
ISBN 13 :
Total Pages : 44 pages
Book Rating : 4.:/5 (13 download)

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Book Synopsis Analysts, Taxes, and the Information Environment by : Sangwan Kim

Download or read book Analysts, Taxes, and the Information Environment written by Sangwan Kim and published by . This book was released on 2019 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper investigates the extent to which analysts incorporate tax-based earnings information into their earnings forecasts relative to other earnings information. We find that analysts' mis-reaction to tax-based earnings information is distinct from their mis-reaction to other (non-tax) accounting information, on average. We then show that analysts differ in their mis-estimation of tax and other (non-tax) earnings components only when firms have weak information environments; when firms have strong information environments, analyst forecasts fully incorporate tax-based earnings information and exhibit no difference incorporating tax-based earnings information relative to other accounting information. Our evidence suggests that, on average, forecasting tax-based earnings information is more difficult for analysts relative to forecasting other accounting information. However, access to appropriate information and resources enables analysts to better process tax information. Overall, we contribute to the literature by providing a more complete understanding of the source of analyst tax-related forecast errors.

Conflicts of Interest

Author : Luc Thévenoz
Publisher : Kluwer Law International B.V.
ISBN 13 : 9041125787
Total Pages : 422 pages
Book Rating : 4.0/5 (411 download)

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Book Synopsis Conflicts of Interest by : Luc Thévenoz

Download or read book Conflicts of Interest written by Luc Thévenoz and published by Kluwer Law International B.V.. This book was released on 2007-01-01 with total page 422 pages. Available in PDF, EPUB and Kindle. Book excerpt: Conflicts of interest arise naturally in all walks of life, particularly in business life. As general and indeed inevitable phenomena, conflicts of interest should not be prohibited but properly managed. This book presents indepth analysis of such management in three areas of corporate governance where the conflict-of-interest problems are particularly acute: executive compensation, financial analysis, and asset management. ""Conflicts of Interest"" presents the results of a two-year-long research project bringing together academics and practitioners in both law and finance from Europe and the.

Rational Inattention and Analyst Forecast Accuracy

Author : Phong Truong
Publisher :
ISBN 13 :
Total Pages : 52 pages
Book Rating : 4.:/5 (13 download)

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Book Synopsis Rational Inattention and Analyst Forecast Accuracy by : Phong Truong

Download or read book Rational Inattention and Analyst Forecast Accuracy written by Phong Truong and published by . This book was released on 2018 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: Facing limited attention constraints, financial analysts must strategically choose which information to pay attention to and which information to ignore when making earnings forecasts. I rely on rational inattention theory to develop and test hypotheses on factors that determine analyst attention and how analyst attention affects forecast accuracy. I construct a novel measure of attention that varies across stocks followed by the same analyst during the same fiscal period. I find that analyst attention is decreasing in the marginal cost of paying attention and that analysts allocate attention to firms with earnings that are difficult to forecast, suggesting that analysts suffer from a limited attention constraint. Importantly, I find that attentive analysts are more accurate, and the effect of attention is larger for inexperienced analysts and stocks with highly volatile earnings. Finally, I find that attentive analysts are less likely to revise forecasts upwards and are less optimistic even after controlling for firm information environment and analyst ability.

Empirical Models of Analyst Forecasts

Author : Youfei Xiao
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (951 download)

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Book Synopsis Empirical Models of Analyst Forecasts by : Youfei Xiao

Download or read book Empirical Models of Analyst Forecasts written by Youfei Xiao and published by . This book was released on 2016 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation is comprised of two studies on analyst forecasts. The first study provides empirical evidence about the objective function underlying analysts' choice of forecasts. Assumptions about sell-side analysts' objective function are critical to empirical researchers' understanding of their incentives and resulting behavior. In contrast to approaches used in previous papers which rely exclusively on statistical properties of forecasts, I compare theoretical models with alternate objective functions based on their ability to explain observed forecasts. A linear loss objective function which incorporates the effect future analysts' actions on analysts' deviation from peer forecasts is best rationalized by the data. I find that assumptions about the objective function have a substantial impact on the conclusions from empirical tests about analysts' incentives and behavior. The second study provides empirical estimates of uncertainty and disagreement about future earnings that underly analyst forecast dispersion. A parsimonious model which assumes that analysts' payoffs are jointly determined by forecast error and deviation from consensus reproduces many of the descriptive facts observed about forecast dispersion in the data. The strategic behavior that arises from the model distorts both the levels of forecast dispersion and the sensitivity of the measure with respect to cross-sectional variation in uncertainty. The estimated parameters perform better at predicting forecast dispersion out-of-sample than approaches based solely on regressions that use firm characteristics. Counterfactual simulations indicate that analysts' strategic incentives, together with the sequential forecast setting, plays a first-order role in determining forecast dispersion relative to the firm's information environment. The model-implied estimates of earnings uncertainty exhibit a substantially less negative association with future returns relative to the association generated by forecast dispersion. This finding partially reconciles the findings from previous studies with theories about the asset pricing implications of uncertainty and disagreement.

Financial Analysts' Forecasts and Stock Recommendations

Author : Sundaresh Ramnath
Publisher : Now Publishers Inc
ISBN 13 : 1601981627
Total Pages : 125 pages
Book Rating : 4.6/5 (19 download)

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Book Synopsis Financial Analysts' Forecasts and Stock Recommendations by : Sundaresh Ramnath

Download or read book Financial Analysts' Forecasts and Stock Recommendations written by Sundaresh Ramnath and published by Now Publishers Inc. This book was released on 2008 with total page 125 pages. Available in PDF, EPUB and Kindle. Book excerpt: Financial Analysts' Forecasts and Stock Recommendations reviews research related to the role of financial analysts in the allocation of resources in capital markets. The authors provide an organized look at the literature, with particular attention to important questions that remain open for further research. They focus research related to analysts' decision processes and the usefulness of their forecasts and stock recommendations. Some of the major surveys were published in the early 1990's and since then no less than 250 papers related to financial analysts have appeared in the nine major research journals that we used to launch our review of the literature. The research has evolved from descriptions of the statistical properties of analysts' forecasts to investigations of the incentives and decision processes that give rise to those properties. However, in spite of this broader focus, much of analysts' decision processes and the market's mechanism of drawing a useful consensus from the combination of individual analysts' decisions remain hidden in a black box. What do we know about the relevant valuation metrics and the mechanism by which analysts and investors translate forecasts into present equity values? What do we know about the heuristics relied upon by analysts and the market and the appropriateness of their use? Financial Analysts' Forecasts and Stock Recommendations examines these and other questions and concludes by highlighting area for future research.

Analyst Career Concerns, Effort Allocation, and Firms' Information Environment

Author : Jarrad Harford
Publisher :
ISBN 13 :
Total Pages : 65 pages
Book Rating : 4.:/5 (13 download)

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Book Synopsis Analyst Career Concerns, Effort Allocation, and Firms' Information Environment by : Jarrad Harford

Download or read book Analyst Career Concerns, Effort Allocation, and Firms' Information Environment written by Jarrad Harford and published by . This book was released on 2018 with total page 65 pages. Available in PDF, EPUB and Kindle. Book excerpt: Because analysts strategically allocate more effort to portfolio firms that are relatively more important for their careers, a firm's information environment is impacted by other firms covered by its analysts. Controlling for analyst and firm characteristics, an analyst makes more accurate, frequent, and informative earnings forecasts and recommendations for firms ranked higher within her portfolio based on proxies for importance to institutions. Firms' relative ranks vary widely across analysts, but when a larger proportion of analysts consider a firm to be relatively important, its information environment improves. Analysts most strategically allocating effort are more likely to experience favorable career outcomes.

New Determinants of Analysts’ Earnings Forecast Accuracy

Author : Tanja Klettke
Publisher : Springer Science & Business
ISBN 13 : 3658056347
Total Pages : 120 pages
Book Rating : 4.6/5 (58 download)

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Book Synopsis New Determinants of Analysts’ Earnings Forecast Accuracy by : Tanja Klettke

Download or read book New Determinants of Analysts’ Earnings Forecast Accuracy written by Tanja Klettke and published by Springer Science & Business. This book was released on 2014-04-28 with total page 120 pages. Available in PDF, EPUB and Kindle. Book excerpt: Financial analysts provide information in their research reports and thereby help forming expectations of a firm’s future business performance. Thus, it is essential to recognize analysts who provide the most precise forecasts and the accounting literature identifies characteristics that help finding the most accurate analysts. Tanja Klettke detects new relationships and identifies two new determinants of earnings forecast accuracy. These new determinants are an analyst’s “general forecast effort” and the “number of supplementary forecasts”. Within two comprehensive empirical investigations she proves these measures’ power to explain accuracy differences. Tanja Klettke’s research helps investors and researchers to identify more accurate earnings forecasts.

Proceedings of MAC-EMM 2016

Author : group of authors
Publisher : MAC Prague consulting
ISBN 13 : 8088085071
Total Pages : 260 pages
Book Rating : 4.0/5 (88 download)

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Book Synopsis Proceedings of MAC-EMM 2016 by : group of authors

Download or read book Proceedings of MAC-EMM 2016 written by group of authors and published by MAC Prague consulting. This book was released on 2016-08-04 with total page 260 pages. Available in PDF, EPUB and Kindle. Book excerpt: Multidisciplinary Academic Conference on Economics, Management and Marketing, Czech Republic, Prague (MAC-EMM 2016)