Timeliness of Analysts' Forecasts: The Information Content of Delayed Forecasts

Shroff, Pervin K.; Venkataraman, Ramgopal; Xin, Baohua

doi:10.1111/1911-3846.12021

Cited by 47 publications

(25 citation statements)

References 32 publications

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“…In other words, our concept of timeliness is based on calendar time, where timeliness declines as each day passes. This differs from the leader-follower relation examined by Cooper et al (2001) and Shroff et al (2013), who classify analysts as leaders if their forecasts prompt a string of forecasts by other analysts (followers). Cooper et al (2001) find that leaders have a larger price impact than followers.…”

Section: Introductioncontrasting

confidence: 56%

“…Cooper et al (2001) find that leaders have a larger price impact than followers. Shroff et al (2013) find that followers' forecasts also affect stock prices, because they convey private information, and reaffirm leaders' information, and conclude that both leaders and followers contribute to price discovery. The leader-follower relation is based on the idea that followers quickly issue their forecasts after the release of a forecast by a leader but not after other followers release forecasts; it does not predict whether a leader or a follower issues an early forecast in calendar time.…”

Section: Introductionmentioning

confidence: 82%

“…Moreover, those studies do not distinguish among analyst activities in the three information production phases. We extend Cooper et al (2001) and Shroff et al (2013) by separating forecast quality differences attributable to the leader/follower status from those attributable to analyst herding in calendar time within an information production phase.…”

Section: Introductionmentioning

confidence: 89%

See 2 more Smart Citations

Analyst Information Production and Forecast Timing

Keskek¹,

Tse

Tucker

2012

SSRN Journal

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Section: Introductioncontrasting

confidence: 56%

Section: Introductionmentioning

confidence: 82%

Section: Introductionmentioning

confidence: 89%

See 1 more Smart Citation

Analyst Information Production and Forecast Timing

Keskek¹,

Tse

Tucker

2012

SSRN Journal

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“…For example, Shroff et al . () show that analysts on average have 4.05 years of firm experience. In Knill et al .…”

mentioning

confidence: 99%

Analyst Firm Coverage and Forecast Accuracy: The Effect of Regulation Fair Disclosure

Dong

et al. 2017

Abacus

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In this study, we revisit the relationship between analyst firm coverage and forecast accuracy. In contrast to the proposed negative association in Clement (1999) owing to the portfolio complexity effect, we hypothesize an 'economy-of-scale effect' that is likely to dominate when analysts rely mostly on public information. In support of the latter effect, we find a positive association between firm coverage and forecast accuracy after the enactment of Regulation Fair Disclosure (Reg FD), which substantially reduces the flow of material private information to analysts. Such a result survives a battery of robustness analyses. We further show that, in the post-Reg FD period, covering more firms increases an analyst's probability of being selected as a star analyst in the subsequent year. Overall, our findings highlight the importance of the information environment in shaping the economic link between an analyst's firm coverage and forecast accuracy.

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“…in the absence of actual earnings). I choose the current context because existing archival studies Tse 2003, 2005;Shroff et al 2011; Zhuang 2011) have documented some evidence, though inconclusive, on the effects of forecast timing and boldness on investors' reactions in the current period (before accuracy is known), but we know little about whether and how the effects of the two forecast characteristics carry over to influence investors' reactions in the subsequent period (after accuracy is known). Third, in my study, a moderate boldness salience forecast is bold in terms of the magnitude relative to the consensus, and is confirmed by other analysts.…”

Section: Discussionmentioning

confidence: 99%

Are accurate bold forecasts better than accurate non-bold forecasts? Investors’ reactions to the joint effect of forecast boldness salience and forecast timing

Zhou¹

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In this study, I conduct an experiment to investigate how financial analysts' forecast boldness salience and forecast timing jointly influence investors' willingness to pay for investment advice, holding constant the accuracy of the forecast. I consider forecast boldness salience to refer to the extent that the magnitude of the analyst's forecast stands out from that made by others in terms of its boldness (magnitude of the forecast relative to the average forecast made by others) and uniqueness (whether there are other individual forecasts that are close or similar to this forecast). Forecast timing refers to whether analysts issue their forecasts earlier or later relative to other analysts. I find that for an early analyst, investors' willingness to pay for advice increases once his/her forecast is confirmed by the follower analyst(s). In contrast, for a late analyst, investors' willingness to pay for advice decreases if his/her forecast is nonbold. My results enrich our understanding on the joint effect of forecast characteristics on investor reaction to analysts' forecasts. I show that the effect of analysts' forecast boldness is contingent on both forecast uniqueness and forecast timing. My study has practical implications on forecasting strategies for financial analysts.

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Timeliness of Analysts' Forecasts: The Information Content of Delayed Forecasts

Cited by 47 publications

References 32 publications

Analyst Information Production and Forecast Timing

Analyst Information Production and Forecast Timing

Analyst Firm Coverage and Forecast Accuracy: The Effect of Regulation Fair Disclosure

Are accurate bold forecasts better than accurate non-bold forecasts? Investors’ reactions to the joint effect of forecast boldness salience and forecast timing

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