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Articles 1 - 6 of 6
Full-Text Articles in Business
Do Analysts’ Eps Forecasts Obey Benford’S Law? An Empirical Analysis, Clarence Goh
Do Analysts’ Eps Forecasts Obey Benford’S Law? An Empirical Analysis, Clarence Goh
Research Collection School Of Accountancy
Benford’s law gives the expected frequencies of digits in tabulated data. In this study, I investigate the extent to which a sample of analysts’ earnings per share (EPS) forecasts obey Benford’s law. I conduct Benford’s law’s second digit and last-two digits tests on a sample of analyst EPS forecasts of S&P 500 firms from 1998 to 2018. Overall, I find that analysts’ EPS forecasts obey Benford’s law’s second digit test but do not obey the last-two digits test. These findings suggest that while analysts do not engage in number invention, they do engage in rounding when making EPS forecasts.
The Effects Of Csr Reputation And Csr Crisis Response Strategy On Investor Judgments, Clarence Goh
The Effects Of Csr Reputation And Csr Crisis Response Strategy On Investor Judgments, Clarence Goh
Research Collection School Of Accountancy
I use a controlled experiment to examine, in the context of CSR crises, whether investors’ investment judgments are influenced by a firm’s CSR reputation and CSR crisis response strategy. I find that for good CSR reputation firms, the use of a rebuild or deny crisis response strategy does not lead to improvements in investment judgments. However, for bad CSR reputation firms, the use of a deny response strategy leads to improvements in investment judgments while the use of a rebuild strategy does not.
Cross-Industry Information Sharing Among Colleagues And Analyst Research, Allen Huang, An-Ping Lin, Amy Y. Zang
Cross-Industry Information Sharing Among Colleagues And Analyst Research, Allen Huang, An-Ping Lin, Amy Y. Zang
Research Collection School Of Accountancy
We identify a specific organizational resource in brokerage housesdinformation sharing among analyst colleagues who cover economically related industries along a supply chain. After controlling for brokerage selection effects, we show evidence consistent with the benefit of this resource to analyst research performance. Specifically, we find that analysts whose colleagues cover more economically connected industries have better research performance, especially when their colleagues produce higher-quality research. We further show that colleagues' coverage of downstream (upstream) industries is positively related to the accuracy of only analysts' revenue (expense) forecasts and that analysts and their highly connected colleagues tend to issue earnings forecast …
Short Sellers And Insider Trading Profitability: A Natural Experiment, Xia Chen, Qiang Cheng, Ting Luo, Heng Yue
Short Sellers And Insider Trading Profitability: A Natural Experiment, Xia Chen, Qiang Cheng, Ting Luo, Heng Yue
Research Collection School Of Accountancy
We examine the impact of short sellers on insider trading profitability using a natural experiment of a pilot program which relaxed short-selling constraints for randomly selected pilot stocks. We find that pilot firms experienced a significant decrease in insider trading profitability during the pilot program. The results are more pronounced for the pilot firms with poor information quality, and for the pilot firms without corporate restrictions on insider trading. Our evidence suggests that short sellers serve an important market disciplinary role by reducing insider trading profitability.
Non-Gaap Earnings And Stock Price Crash Risk, Charles Hsu, Rencheng Wang, Benjamin C. Whipple
Non-Gaap Earnings And Stock Price Crash Risk, Charles Hsu, Rencheng Wang, Benjamin C. Whipple
Research Collection School Of Accountancy
We investigate whether non-GAAP earnings disclosures increase stock price crash risk. Consistent with non-GAAP disclosures allowing managers to inflate investors' perceptions about firm performance, our results indicate that income increasing non-GAAP reporting increases crash risk. We also find that managers can use non-GAAP reporting as a substitute for earnings management to withhold bad news from investors (the traditional explanation for crashes). Finally, we find a positive association between non-GAAP reporting and the likelihood of subsequent events that can trigger a crash. Overall, our evidence is consistent with some non-GAAP disclosures exposing investors to risks of large and sudden price declines.(c) …
Do Managers Learn From Analyst Participation In Conference Calls?, Amanda Aw Zhi Xin Yong, Young Jun Cho, Holly I. Yang
Do Managers Learn From Analyst Participation In Conference Calls?, Amanda Aw Zhi Xin Yong, Young Jun Cho, Holly I. Yang
Research Collection School Of Accountancy
While research finds that conference calls are informative to the market and analysts, they can also be informative to managers as analysts’ questions can provide a feedback effect. Using a sample of conference call transcripts from 2002 to 2018, we find that greater analyst participation, as measured by the number of words spoken by analysts relative to the number of words spoken by managers during conference calls, is associated with higher accuracy in managers’ subsequent earnings forecasts. Cross-sectional tests show that this positive association is more pronounced when managers use more uncertain words in conference calls, when analysts use a …