Portfolio Returns and Target Prices

Bonini, Stefano; Salvi, Antonio; Bianchini, Roberto; Zanetti, Laura

doi:10.2139/ssrn.1063861

Cited by 4 publications

(1 citation statement)

References 22 publications

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“…A small but growing literature examines the determinants and investment value of target prices (Bandyopadhyay, Brown and Richardson, ; Bradshaw, , Brav and Lehavy, ; Asquith, Mikhail and Au, ; Gleason, Johnson and Li, ). Bonini, Salvi, Bianchini and Zanetti () find that investment strategies based on target prices deliver positive abnormal returns, supporting the notion that analysts’ target prices are useful. Da and Schaumburg () show profitable trading strategies based on industry relative valuations implicitly embedded in analyst target prices, suggesting the informativeness of target prices is driven by analysts’ ability to assess the relative performance of stocks within a specific industry.…”

Section: Literature Review and Hypothesesmentioning

confidence: 81%

When Analysts Talk, Do Institutional Investors Listen? Evidence from Target Price Changes

Lin

Tan

Zhang

2016

The Financial Review

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We find that institutions trade in the same direction as target price changes based on 6,415 U.S. firms from 1999 to 2011, even after controlling changes in stock recommendations and earnings forecasts. The impact of target price changes on institutional trading is more pronounced for small firms, firms followed by few analysts, and illiquid firms, and is mainly limited to transient institutions. We do not find any outperformance for institutions to follow analysts’ target price forecasts, suggesting that institutions could find it easier to justify their investment decisions by following analyst forecasts, although such trading does not result in outperformance.

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Section: Literature Review and Hypothesesmentioning

confidence: 81%

When Analysts Talk, Do Institutional Investors Listen? Evidence from Target Price Changes

Lin

Tan

Zhang

2016

The Financial Review

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Analysts’ Recommendations in Brazil: Do They Add Value?

Júnior

Rochman²

2009

SSRN Journal

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This paper examines the value of analysts' recommendations in Brazilian Stock Market. We studied a sample of 294 weeks of recommendations make public by the best seller newspaper in Brazil with six different investment strategies and time horizons. The main conclusion is that it is possible to beat the Brazilian market indexes Ibovespa and IBrX following the analysts' stock recommendations. The best strategies are buying only the recommended stocks, buying the recommended stocks whose target and market prices difference is bigger than 25% and lesser or equal than 50%. The performance of the six strategies is analyzed through the use of bootstrap and Monte Carlo techniques.

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When Analysts Talk, Do Institutional Investors Listen? Evidence from Target Price Changes

Lin

Tan

2012

SSRN Journal

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Portfolio Returns and Target Prices

Cited by 4 publications

References 22 publications

When Analysts Talk, Do Institutional Investors Listen? Evidence from Target Price Changes

When Analysts Talk, Do Institutional Investors Listen? Evidence from Target Price Changes

Analysts’ Recommendations in Brazil: Do They Add Value?

When Analysts Talk, Do Institutional Investors Listen? Evidence from Target Price Changes

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