scholarly journals The Role of Analysts in Intra-Industry Information Transfer

2013 ◽  
Vol 88 (4) ◽  
pp. 1265-1287 ◽  
Author(s):  
Gilles Hilary ◽  
Rui Shen
Keyword(s):  
Information Transfer ◽  
Earnings Forecasts ◽  
Data Availability ◽  
Forecast Revisions ◽  
Management Forecast

ABSTRACT When a firm issues a management forecast, analysts who have observed more forecasts from this firm since covering it (i.e., have more MF-Experience) subsequently improve their own accuracy more and provide timelier earnings forecasts for other (non-issuing) firms in the same industry. We also find that, subsequent to a management forecast, investors are more responsive to forecast revisions for non-issuing firms made by analysts with more MF-Experience. Further tests suggest that our results are not explained by endogeneity in firm coverage. Data Availability: Data are commercially available.

scholarly journals The Role of Anchoring Bias in the Equity Market: Evidence from Analysts’ Earnings Forecasts and Stock Returns

2012 ◽  
Vol 48 (1) ◽  
pp. 47-76 ◽  
Author(s):  
Ling Cen ◽  
Gilles Hilary ◽  
K. C. John Wei
Keyword(s):  
Stock Returns ◽  
Earnings Forecasts ◽  
Equity Market ◽  
Stock Splits ◽  
Forecast Errors ◽  
Forecast Revisions ◽  
Earnings Per Share ◽  
Earnings Surprises ◽  
Anchoring Bias

AbstractWe test the implications of anchoring bias associated with forecast earnings per share (FEPS) for forecast errors, earnings surprises, stock returns, and stock splits. We find that analysts make optimistic (pessimistic) forecasts when a firm’s FEPS is lower (higher) than the industry median. Further, firms with FEPS greater (lower) than the industry median experience abnormally high (low) future stock returns, particularly around subsequent earnings announcement dates. These firms are also more likely to engage in stock splits. Finally, split firms experience more positive forecast revisions, more negative forecast errors, and more negative earnings surprises after stock splits.

Cost of Capital Free-Riders

2016 ◽  
Vol 91 (5) ◽  
pp. 1291-1313 ◽  
Author(s):  
Stephen P. Baginski ◽  
Lisa A. Hinson
Keyword(s):  
Information Transfer ◽  
Cost Of Capital ◽  
Information Loss ◽  
Data Availability ◽  
Policy Decisions ◽  
Analyst Following ◽  
Disclosure Policy ◽  
Free Riders ◽  
Management Forecast ◽  
Jel Classifications

ABSTRACTWe document the interrelationship of disclosure policy decisions among firms by providing evidence that the cessation of quarterly management forecast guidance by 656 firms (“stoppers”) during 2004–2009 is associated with a pursuant increase in quarterly forecasts by previously non-forecasting firms in the same industries (“free-riders”). Increased forecasting by free-riders is positively associated with the information loss in the industry (proxied by the number of stoppers in the industry, the strength of previously existing information transfer relations between stoppers and free-riders, and whether stoppers and free-riders are peer firms) and the importance of the information loss to the free-riders (proxied by analyst following and the existence of new share issues). Following the cessation event, free-riders' cost of capital decreases as a function of the extent to which free-riders immediately initiate quarterly forecasting.JEL Classifications: M41.Data Availability: Data are available from the sources indicated in the text.

How the Interplay between Financial and Nonfinancial Measures Affects Management Forecasting Behavior

2019 ◽  
Vol 31 (3) ◽  
pp. 41-63 ◽  
Author(s):  
Joseph F. Brazel ◽  
Bradley E. Lail
Keyword(s):  
Earnings Forecasts ◽  
Data Availability ◽  
Forecast Errors ◽  
Earnings Growth ◽  
Management Forecast ◽  
Nonfinancial Measures ◽  
External Stakeholders ◽  
Jel Classifications ◽  
Future Management

ABSTRACT This study examines how the interplay between financial and nonfinancial measures (NFMs) affects management forecasting behavior. Building on the knowledge that NFMs are typically aligned with actual earnings and are likely incorporated into earnings forecasts, we investigate if the level of divergence between changes in NFMs and contemporaneous changes in earnings influences management forecasting behavior. We hand collect company-specific NFMs disclosed in 10-K filings and describe how a greater divergence between NFMs and earnings (i.e., NFM changes substantially outpacing earnings growth, or vice versa) is associated with greater uncertainty about the underlying business. As such, in more divergent settings, we observe that management is less likely to issue guidance. Consistent with our theory, for managers that do provide guidance in more divergent settings, management forecast errors increase. Last, we provide evidence that external stakeholders can use the level of divergence to predict future management forecasting behavior. JEL Classifications: G14; M40; M41. Data Availability: The data used in this study are publicly available from the sources indicated in the text.

The Interactive Role of Difficulty and Incentives in Explaining the Annual Earnings Forecast Walkdown

2016 ◽  
Vol 91 (4) ◽  
pp. 995-1021 ◽  
Author(s):  
Mark T. Bradshaw ◽  
Lian Fen Lee ◽  
Kyle Peterson
Keyword(s):  
Interactive Effect ◽  
Earnings Forecasts ◽  
Data Availability ◽  
Analyst Forecast ◽  
Earnings Forecast ◽  
Regression Analyses ◽  
Strategic Incentives ◽  
Psychology Literature ◽  
Annual Earnings

ABSTRACT The within-year walkdown of analysts' earnings forecasts has largely been attributed to analysts' incentives to curry favor with managers. We appeal to cognitive psychology literature on motivated reasoning and propose that forecasting difficulty interacts with such incentives to yield the observed walkdown. Higher forecasting difficulty generates a wider range of outcomes from which analysts can justify optimistically biased forecasts. In regression analyses, we find that the interaction between analysts' incentives for optimism and difficulty exhibits the strongest effect on earnings walkdowns. We also examine revenue forecasts as a benchmark of lower forecasting difficulty and find that revenue walkdowns are relatively diminutive. However, when analysts forecast losses, revenue forecasts are more critical and exhibit markedly steeper walkdowns. Our results suggest that analyst forecast walkdowns are better characterized by an interactive effect between analysts' strategic incentives for optimism and forecasting difficulty. JEL Classifications: G17; M41. Data Availability: Data are available from public sources identified in the text.

NATURAL SCIENTISTS AND RUSSIAN SCIENTIFIC FILMMAKING IN THE PRE-REVOLUTIONARY PERIOD (SCIENCE DIVISION OF THE A.A. KHANZHONKOV COMPANY)

2020 ◽  
Vol 42 (3) ◽  
pp. 355-368
Author(s):  
YEVGENIY ALEKSANDROV
Keyword(s):  
Information Transfer ◽  
Delayed Reaction ◽  
Russian Scientific ◽  
Physical Problems ◽  
Education Community ◽  
Future System ◽  
The Future ◽  
The Spectator ◽  
Revolutionary Period

The aim of the article is to recall the fi steps of comprehension by the scientific community of possibilities of a newly born means of the reality reflection. The means was initially oriented for obtaining reliable information and supposing a delayed reaction of the spectator in the process of communication. Recollection and understanding become more important under the distance education condition. Pre-revolutionary Russia lived anticipating changes, and the filmmaking was considered by the society as one of those progressive phenomena evidencing the coming of a new age. The scientists’ activity during the development of scientific fi in pre-revolutionary Russia was long hushed up and wasn’t considered as forming a basis for the future system of educational audio-visual communication. In this process there participated striking, creative personalities, mostly belonged to the community of Imperial Moscow University, which activity was during the age of changes. The significant contribution of pleiad of eminent scientists’ activity to the new direction formation was a reason to unify in one paper both their whole professional life data and information about their time-limited period of scientific fi In the future a more profound study of their achievements are considered to be promising. In the introduction the anterior period of the Russian fi appearance, where the scientific and education community of Russia was exploring the possibilities of a new means of information transfer for education purposes, is considered. Two main units are dedicated to the role of scientists in the development of scientific filmmaking for research and popularization of biomedical and physical problems.

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.

Concurrent Earnings Announcements and Analysts' Information Production

2019 ◽  
Vol 95 (1) ◽  
pp. 165-189 ◽  
Author(s):  
Matthew Driskill ◽  
Marcus P. Kirk ◽  
Jennifer Wu Tucker
Keyword(s):  
Earnings Announcements ◽  
Financial Analysts ◽  
Earnings Forecasts ◽  
Data Availability ◽  
Limited Attention ◽  
Conference Calls ◽  
Stock Recommendations ◽  
Rich Information ◽  
Sample Firm ◽  
Jel Classifications

ABSTRACT We examine whether financial analysts are subject to limited attention. We find that when analysts have another firm in their coverage portfolio announcing earnings on the same day as the sample firm (a “concurrent announcement”), they are less likely to issue timely earnings forecasts for the sample firm's subsequent quarter than analysts without a concurrent announcement. Among the analysts who issue timely earnings forecasts, the thoroughness of their work decreases as their number of concurrent announcements increases. In addition, analysts are more sluggish in providing stock recommendations and less likely to ask questions in earnings conference calls as their number of concurrent announcements increases. Moreover, when analysts face concurrent announcements, they tend to allocate their limited attention to firms that already have rich information environments, leaving behind firms in need of attention. Overall, our evidence suggests that even financial analysts, who serve as information specialists, are subject to limited attention. JEL Classifications: G10; G11; G17; G14. Data Availability: Data are publicly available from the sources identified in the paper.

External Investigators' Follow-Up Intentions When Whistleblowers Report Healthcare Fraud: The Effects of Report Anonymity and Previous Confrontation

2020 ◽  
Vol 32 (2) ◽  
pp. 91-101
Author(s):  
Steven E. Kaplan ◽  
Danny Lanier ◽  
Kelly R. Pope ◽  
Janet A. Samuels
Keyword(s):  
Experimental Study ◽  
Early Detection ◽  
Data Availability ◽  
Medical Provider ◽  
Perceived Credibility ◽  
The Relationship ◽  
Critical Investigation

ABSTRACT Whistleblowing reports, if properly investigated, facilitate the early detection of fraud. Although critical, investigation-related decisions represent a relatively underexplored component of the whistleblowing process. Investigators are responsible for initially deciding whether to follow-up on reports alleging fraud. We report the results of an experimental study examining the follow-up intentions of highly experienced healthcare investigators. Participants, in the role of an insurance investigator, are asked to review a whistleblowing report alleging billing fraud occurring at a medical provider. Thus, participants are serving as external investigators. In a between-participant design, we manipulate the report type and whether the caller previously confronted the wrongdoer. We find that compared to an anonymous report, a non-anonymous report is perceived as more credible and follow-up intentions stronger. We also find that perceived credibility fully mediates the relationship between report type and follow-up intentions. Previous confrontation is not significantly associated with either perceived credibility or follow-up intentions. Data Availability: Data are available upon request.

scholarly journals Investment Portfolio, Democratic Accountability, Poverty and Income Inequality Nexus in Pakistan: A Way to Social Sustainability

2021 ◽  
Vol 13 (11) ◽  
pp. 6411
Author(s):  
Muhammad Shahid Hassan ◽  
Haider Mahmood ◽  
Muhammad Ibrahim Saeed ◽  
Tarek Tawfik Yousef Alkhateeb ◽  
Noman Arshed ◽  
...  
Keyword(s):  
Income Inequality ◽  
Social Sustainability ◽  
Data Availability ◽  
Democratic Accountability ◽  
Investment Portfolio ◽  
Economic Activities ◽  
Distributed Lag ◽  
Autoregressive Distributed Lag ◽  
Short Run

Institutions help to streamline the economic activity-related procedures, where government intervention might be involved. Institutions also play a significant role in social sustainability. The findings using the Autoregressive Distributed Lag approach to cointegration for the period from 1984–2019 reveal that investment portfolio and democratic accountability reduce poverty in Pakistan both in the long and short run. Moreover, democratic accountability helps to reduce income inequality, but the investment portfolio’s role is not significant. The literacy rate helps to reduce income inequality, and inflation increases poverty and income inequality. The remittances increase income inequality, and urbanization increases poverty. To eradicate poverty and income inequality, the governments should be accountable for their actions to the general public while they remain in power. If they do not deliver as per their manifestoes, they will not be reelected in the next election. Moreover, there is a dire need to redefine the role of an investment portfolio to reduce the risk of investment. So, investments would increase economic activities and could reduce poverty and income inequality. This study contributes to the literature by inquiring about the role of the investment portfolio and democratic accountability in social sustainability by reducing poverty and income inequality. This study only considers Pakistan’s economy due to limitations of poverty data availability in other countries. The scope could further be broadened by accessing data for a wider Asia region to test the role of the investment portfolio and democratic accountability to reduce poverty and income inequality.

scholarly journals The Determinants of Access to Sanitation: The Role of Human Rights and the Challenges of Measurement

Water ◽  
2021 ◽  
Vol 13 (12) ◽  
pp. 1676
Author(s):  
Rebecca Schiel ◽  
Bruce M. Wilson ◽  
Malcolm Langford
Keyword(s):  
Sustainable Development ◽  
Human Rights ◽  
Field Data ◽  
Data Availability ◽  
Regression Analyses ◽  
Human Right ◽  
Sustainable Development Goal ◽  
Development Goal ◽  
The Sustainable Development

Ten years after the United Nation’s recognition of the human right to water and sanitation (HRtWS), little is understood about how these right impacts access to sanitation. There is limited identification of the mechanisms responsible for improvements in sanitation, including the international and constitutional recognition of rights to sanitation and water. We examine a core reason for the lack of progress in this field: data quality. Examining data availability and quality on measures of access to sanitation, we arrive at three findings: (1) where data are widely available, measures are not in line with the Sustainable Development Goal (SDG) targets, revealing little about changes in sanitation access; (2) data concerning safe sanitation are missing in more country-year observations than not; and (3) data are missing in the largest proportions from the poorest states and those most in need of progress on sanitation. Nonetheless, we present two regression analyses to determine what effect rights recognition has on improvements in sanitation access. First, the available data are too limited to analyze progress toward meeting SDGs related to sanitation globally, and especially in regions most urgently needing improvements. Second, utilizing more widely available data, we find that rights seem to have little impact on access.

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