THE ASSOCIATION BETWEEN ANALYSTS’ FORECAST REVISIONS AND EARNINGS COMPONENTS: THE EVIDENCE OF FRS 3

2002 ◽  
Vol 34 (1) ◽  
pp. 1-26 ◽  
Author(s):  
STEPHEN LIN
Keyword(s):  
Forecast Revisions ◽  
Earnings Components

Analysts' Interpretation of Transitory Earnings Components: Evidence from Forecast Revisions after Disclosure of the 1993 Deferred Tax Adjustment

2003 ◽  
Vol 18 (3) ◽  
pp. 333-353 ◽  
Author(s):  
Kevin C. W. Chen ◽  
Morris G. Danielson ◽  
Michael P. Schoderbek
Keyword(s):  
Income Tax ◽  
Earnings Forecasts ◽  
Corporate Income Tax ◽  
Analyst Forecast ◽  
Tax Rate ◽  
Forecast Revisions ◽  
Future Earnings ◽  
Earnings Components ◽  
Deferred Tax ◽  
The U.S

This study examines analyst forecast revisions after the disclosure of firms' deferred tax adjustments following the U.S. Omnibus Budget Reconciliation Act of 1993 (OBRA), which raised the corporate income tax rate from 34 percent to 35 percent. This deferred tax adjustment was a one-time item, and should have had no effect on analyst estimates of future earnings. However, we find that forecast revisions issued after the disclosure of an income-decreasing deferred tax adjustment were positively related to the amount of the adjustment. The complexity of the deferred tax adjustment and the newness of SFAS 109 (which required the adjustment) may have contributed to the failure of analysts to properly interpret this one-time item when revising their earnings forecasts.

Discretionary Reporting of Earnings Components

1998 ◽  
Author(s):  
Catherine M. Schrand ◽  
Beverly R. Walther
Keyword(s):  
Earnings Components

Information Technology Capability, Management Forecast Accuracy, and Analyst Forecast Revisions

2018 ◽  
Vol 32 (3) ◽  
pp. 49-70 ◽  
Author(s):  
Feiqi Huang ◽  
He Li ◽  
Tawei Wang
Keyword(s):  
Forecast Accuracy ◽  
Analyst Forecast ◽  
Management Forecasts ◽  
Forecast Revisions ◽  
It Capability ◽  
Management Forecast ◽  
Prior Literature ◽  
Technology Capability ◽  
Information Technology Capability ◽  
The Relationship

SYNOPSISPrior literature has firmly established the relationship between IT capability and firm performance. In this paper, we extend the research in this field and investigate (1) whether IT capability contributes to management forecast accuracy, and (2) whether IT capability improves the informativeness of management forecasts and enhances the extent to which analysts incorporate management forecasts in their revisions. Using firms listed on InformationWeek 500 as our high IT capability group, we empirically demonstrate that firms with high IT capability are able to increase management forecast accuracy, and that analysts incorporate more information from management forecasts in their revisions if the firm has high IT capability.

Earnings Shortfalls and Strategic Profit Allocations in Segment Reporting

2019 ◽  
Vol 33 (4) ◽  
pp. 37-58 ◽  
Author(s):  
Timothy D. Haight
Keyword(s):  
Firm Value ◽  
Data Availability ◽  
Segment Reporting ◽  
Market Responses ◽  
Earnings Components ◽  
The Future ◽  
Earnings Performance ◽  
Profit Rates

SYNOPSIS I examine whether firms strategically classify earnings components when reporting bad earnings news. Specifically, I examine whether firms reporting small earnings shortfalls allocate profits across their business segments in a manner that understates the future implications and within-firm drivers of disappointing earnings performance. I find that firms reporting small earnings shortfalls transfer profits toward segments in which profit rates are more informative for firm value and away from segments that operate in industries with higher frequencies of bad earnings news. In addition, I find that shortfall shifting initially tempers negative market responses to shortfall news, but pricing effects reverse in the months following shortfall announcements. My findings suggest that firms strategically classify earnings components when reporting small earnings shortfalls and that strategic classifications temporarily affect the pricing of shortfall news. Data Availability: Data are available from public sources identified in this paper.

scholarly journals An analysis of Japanese earnings forecast revisions with application to seasoned equity offerings

2011 ◽  
Vol 20 (3) ◽  
pp. 376-387 ◽  
Author(s):  
Gary L. Caton ◽  
Justin S.P. Chan ◽  
Jeremy Goh ◽  
Sheng-Yung Yang
Keyword(s):  
Seasoned Equity Offerings ◽  
Earnings Forecast ◽  
Equity Offerings ◽  
Forecast Revisions

scholarly journals Forecast revisions of Mexican inflation and GDP growth

2014 ◽  
Vol 30 (2) ◽  
pp. 177-191 ◽  
Author(s):  
Carlos Capistrán ◽  
Gabriel López-Moctezuma
Keyword(s):  
Gdp Growth ◽  
Forecast Revisions
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