Does Analyst Optimism About Future Earnings Distort Stock Prices?

Empirical Linkages between Trading Volume and Stock Markets Shocks: When Sentiments Drive Investors’ Behavior

“…For Ciccone (2003), investor sentiments and behaviors determine a substantial part of the stock market. Optimistic and pessimistic beliefs influence the extensively both the stock prices and trading volume and are reflected in them.…”

Animal Spirits and Trading Volume in International Financial Markets between 2002 and 2011

“…The investors' beliefs as components of animal spirits are also considered in several other studies (Daniel, Hirshleifer and Subrahmanyam, 1998;Haruvy, Stahl and Wilson, 1999;Weinstein, 1989;Otten, 1989;De Bondt and Thaler, 1987;Barberis Journal of Economic and Social Studies Shleifer and Vishny, 1998;Ciccone, 2003;Piroscă, 2011). A point of view commonly shared by the major of authors is that investors' beliefs impact significantly the economy works and explain in a major part the economy dysfunction.…”

“…Ciccone (2003) uses annual earnings forecast to determine optimism. Optimism is present when the mean annual earnings forecast exceeds the corresponding actual earnings.…”

Equity issues and temporal variation in information asymmetry

“…Ciccone, 2003). For example, firm management might be more forthcoming with good rather than bad news, thereby reducing information asymmetry before high earnings.…”