Another Look: The Impact of Multi-Dimensional Corporate Transparency on US Firms’ Market Liquidity and Analyst Forecast Properties

2019 ◽  
Vol 22 (02) ◽  
pp. 1950008 ◽  
Author(s):  
D. G. DeBoskey ◽  
Peter R. Gillett
Keyword(s):  
Earnings Quality ◽  
Market Liquidity ◽  
Quality Information ◽  
Analyst Forecast ◽  
Forecast Dispersion ◽  
Information Transparency ◽  
Corporate Transparency ◽  
Market Depth ◽  
The Impact ◽  
Bid Ask Spreads

Using a multi-dimensional model of corporate transparency developed by DeBoskey and Gillett (2011) based on disclosure information, intermediary information, earnings quality information, and insider information, this study extends their findings to examine whether corporate transparency has significant power to explain cross-sectional variation in market liquidity (measured by bid-ask spreads and market depth) and analyst forecast properties (measured by analyst forecast accuracy and analyst forecast dispersion). We find that: (i) market depth and analyst forecast dispersion are significantly associated with public disclosure information transparency; (ii) market depth, forecast dispersion and forecast error are significantly associated with intermediary information transparency; and (iii) relative bid-ask spreads is signficantly associated with earnings quality information. Our findings offer an extended view of the impact of corporate transparency on a set of criterion variables expanded beyond firm-level ones to include market participants such as dealers/specialists who rely to some extent on company-provided information.

Discussion: “Dispersion in Analysts' Earnings Forecasts as a Measure of Uncertainty”

1998 ◽  
Vol 13 (3) ◽  
pp. 271-274 ◽  
Author(s):  
Lawrence D. Brown
Keyword(s):  
Stock Price ◽  
Annual Report ◽  
Earnings Forecasts ◽  
Analyst Forecast ◽  
Earnings Forecast ◽  
Data Set ◽  
Forecast Dispersion ◽  
Forecast Revision ◽  
Analyst Earnings ◽  
The Impact

This paper tackles an interesting question; namely, whether dispersion in analysts' earnings forecasts reflects uncertainty about firms' future economic performance. It improves on the extant literature in three ways. First, it uses detailed analyst earnings forecast data to estimate analyst forecast dispersion and revision. The contrasting evidence of Morse, Stephan, and Stice (1991) and Brown and Han (1992), who respectively used consensus and detailed analyst data to examine the impact of earnings announcements on forecast dispersion, suggest that detailed data are preferable for determining the data set on which analysts' forecasts are conditioned. Second, it relates forecast dispersion to both analyst earnings forecast revision and stock price reaction to the subsequent earnings announcement. Previous studies related forecast dispersion to either analyst forecast revision (e.g., Stickel 1989) or to subsequent stock price movements (e.g., Daley et al. [1988]), but not to both revision and returns. Third, it includes the interim quarters along with the annual report. In contrast, previous research focused on the annual report, ignoring the interims (Daley et al. [1988]).

Review on Foreign Study of Corporate Bond Spread

2013 ◽  
Vol 655-657 ◽  
pp. 2258-2261
Author(s):  
Jie Min Huang ◽  
Su Sheng Wang ◽  
Jing Xia Xu ◽  
Zhao Hua Lan
Keyword(s):  
Credit Risk ◽  
Systemic Risk ◽  
Default Risk ◽  
Equity Market ◽  
Corporate Bond ◽  
Analyst Forecast ◽  
Foreign Study ◽  
Forecast Dispersion ◽  
Market Index ◽  
The Impact

Foreign literatures are mainly about analyst forecast dispersion, liquidity risk, equity market volatility, default risk, taxes, credit risk, and the interaction of credit risk and default risk and other factors that influence bond spread. The literatures including the research on the impact of equity market index, but little literatures refer to the impact of bond complex index on bond spread. There are different opinions about the impact of systemic risk on bond spread

Empirical Evidence on the Impact of Book-Tax Differences on Divergence of Opinion among Investors

2011 ◽  
Vol 33 (1) ◽  
pp. 51-78 ◽  
Author(s):  
Joseph Comprix ◽  
Roger C. Graham ◽  
Jared A. Moore
Keyword(s):  
Financial Statements ◽  
Financial Accounting ◽  
Analyst Forecast ◽  
Market Uncertainty ◽  
Financial Reports ◽  
Forecast Dispersion ◽  
Market Participants ◽  
Divergence Of Opinion ◽  
Return Variance ◽  
The Impact

ABSTRACT: It is well known that the objectives of financial accounting and tax accounting sometimes conflict, resulting in book-tax differences (BTDs). In this study we test for associations between measures of BTDs and measures of market participants’ uncertainty regarding the information conveyed in financial reports. The measures of market participant uncertainty are: (1) share turnover, (2) analyst forecast dispersion, and (3) stock return variance. We find positive associations between levels and variability of total BTDs and the three measures. After disaggregating BTDs into their permanent and temporary components, we find that both are positively associated with market uncertainty, although the permanent component of BTDs is generally more strongly and consistently associated with measures of uncertainty than is the temporary component. We interpret these results, in part, as indicative of the possible effect of uncertainty contained in BTDs, especially permanent BTDs, on the precision of the information conveyed in the financial statements.

scholarly journals The Role Of Earnings Quality In Financial Analyst Forecast Accuracy

2013 ◽  
Vol 30 (1) ◽  
pp. 255 ◽  
Author(s):  
David Salerno
Keyword(s):  
Earnings Quality ◽  
Financial Analysts ◽  
Forecast Accuracy ◽  
Earnings Forecasts ◽  
Cash Flows ◽  
Analyst Forecast ◽  
Financial Reports ◽  
The Individual ◽  
Reported Earnings ◽  
The Impact

This study investigates the impact that the quality of reported earnings has on the accuracy of financial analysts earnings forecasts. Extant research indicates that earnings attributes are important considerations to users of accounting information. One such attribute is earnings quality; often measured as the magnitude of accruals that do not convert to cash in a timely manner, where a poor match of cash flows and accruals indicates low earnings quality. Such accruals could reduce the usefulness of financial reports. This study uses two measurements of forecast accuracy to assess the impact that earnings quality has on the forecast accuracy of financial analysts. Following prior research, one measurement considers the environment in which the analyst operates and compares their accuracy to that of their peers. The second compares the individual analyst forecast to the actual reported earnings. For both measurements of accuracy the results show that higher earnings quality is associated with improved forecast accuracy.

The Role of Dissemination in Market Liquidity: Evidence from Firms' Use of Twitter™

2013 ◽  
Vol 89 (1) ◽  
pp. 79-112 ◽  
Author(s):  
Elizabeth Blankespoor ◽  
Gregory S. Miller ◽  
Hal D. White
Keyword(s):  
Information Asymmetry ◽  
Market Liquidity ◽  
Data Availability ◽  
Market Participants ◽  
Technology Firms ◽  
The Press ◽  
The Impact ◽  
To Receive ◽  
Bid Ask Spreads

ABSTRACT Firm disclosures often reach only a portion of investors, which results in information asymmetry among investors and, therefore, lower market liquidity. This issue is particularly salient for firms that are not highly visible, as they tend not to receive broad news dissemination via traditional intermediaries, such as the press. This paper examines whether firms can reduce information asymmetry by more broadly disseminating their news. To isolate the impact of dissemination, we focus our analysis on firms' use of Twitter and exploit the 140-character message restriction. Specifically, using a sample of technology firms, we examine the impact of using Twitter to send market participants links to press releases that are provided via traditional disclosure methods. We find this additional dissemination of firm-initiated news via Twitter is associated with lower abnormal bid-ask spreads and greater abnormal depths, consistent with a reduction in information asymmetry. Moreover, this result holds mainly for firms that are not highly visible, consistent with them being in greater need of this additional dissemination channel. We also examine the impact of dissemination on a volume-based measure of liquidity, and find that dissemination is positively associated with liquidity. Data Availability: All data are publicly available from the sources indicated in the paper.

Here there Be Tygers: Profit, Non-profit, and Loss in the Age of Disintermediation

1997 ◽  
Vol 22 (3) ◽  
Author(s):  
Michael Jensen
Keyword(s):  
Eastern Europe ◽  
Social Institutions ◽  
Scholarly Publishing ◽  
The Political ◽  
Quality Information ◽  
High Quality ◽  
Non Profit ◽  
High Quality Information ◽  
Europe De L’Est ◽  
The Impact

Abstract: Scholarly publishing and access to high-quality information may in fact be threatened, rather than improved, by the revolution in communications, particularly in a fully commercial Internet. The effects of the political revolution in Eastern Europe on scholarship and quality publishing are used as a touchstone of the dangers that occur when naïve revolutionaries make swift changes without fully recognizing the impact upon delicately balanced social institutions such as non-profit organizations. Résumé: La révolution en communications, particulièrement en ce qui regarde un Internet commercialisé, plutôt que d'améliorer l'édition savante et l'accès à de l'information de haute qualité, pourrait en fait poser une menace pour ceux-ci. Cet article examine comment la révolution politique en Europe de l'Est a influé sur la recherche et l'édition de qualité. Il utilise cet exemple pour examiner les dangers que peuvent courir certains révolutionnaires naïfs quand ils instaurent des changements rapides san songer à leur impact sur des institutions sociales à équilibre délicat comme les organisations à but non lucratif.

scholarly journals Market buoyancy, information transparency and pricing strategy in the Scottish housing market

Urban Studies ◽  
2021 ◽  
pp. 004209802199178
Author(s):  
Nan Liu
Keyword(s):  
Pricing Strategy ◽  
Selling Price ◽  
Trade Off ◽  
Information Transparency ◽  
North East ◽  
Sealed Bid ◽  
Strategy Changes ◽  
The Impact ◽  
Role Of Information

In housing markets there is a trade-off between selling time and selling price, with pricing strategy being the balancing act between the two. Motivated by the Home Report scheme in Scotland, this paper investigates the role of information symmetry played in such a trade-off. Empirically, this study tests if sellers’ pricing strategy changes when more information becomes available and whether this, in turn, affects the trade-off between the selling price and selling time. Using housing transaction data of North-East Scotland between 1998Q2 and 2018Q2, the findings show that asking price has converged to the predicted price of the property since the introduction of the Home Report. While information transparency reduces the effect of ‘overpricing’ on selling time, there is little evidence to show that it reduces the impact of pricing strategy on the final selling price in the sealed-bid context.

The Impact of Claims Management, Treatment, and Rehabilitation on Recovery and Return to Independence

2012 ◽  
Vol 7 ◽  
pp. 35-39 ◽  
Author(s):  
Liz Cairns ◽  
Maree Dyson ◽  
Sally Canobi ◽  
Nic Vipond
Keyword(s):  
Financial Performance ◽  
Best Practice ◽  
Personal Injury ◽  
Quality Information ◽  
Client Outcomes ◽  
Evaluation Program ◽  
Accident Compensation ◽  
Serious Injury ◽  
The Impact

The use of contemporaneous evaluation in personal injury insurance enables schemes to maintain and enhance their viability through access to quality information on cost, liabilities and outcomes. Best practice in research programs in the sector requires data on client outcomes and financial performance to be collected. This article presents a case study of the research and evaluation program for the National Serious Injury Service of New Zealand's Accident Compensation Corporation.

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