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Full-Text Articles in Business
The Value Of Assurance Over Internal Controls: Evidence From Mergers And Acquisitions, Ryan Courtlin Cating
The Value Of Assurance Over Internal Controls: Evidence From Mergers And Acquisitions, Ryan Courtlin Cating
Graduate Theses and Dissertations
In this study, I examine the value of assurance over internal controls in the mergers and acquisitions setting. Specifically, I examine the how the existence of an internal control audit mandated under Section 404(b) of SOX affects information asymmetry as proxied for by the likelihood of a company becoming the target of an acquisition. I find that companies with internal control audits are significantly more likely to receive bids than their counterparts that do not have an internal control audit. Upon further investigation, I find that the mechanism by which companies are more likely to become the target of an …
Analyst Talent, Information, And Investment Strategies, Zhichuan Li, Stephen R. Foerster, Zhenyang Tang, Chongyu Dang
Analyst Talent, Information, And Investment Strategies, Zhichuan Li, Stephen R. Foerster, Zhenyang Tang, Chongyu Dang
Business Publications
Analyst talent, rather than the number of analysts following a firm, matters most to investors. We find: 1) Analysts with greater “natural” forecasting talent—controlling for experience, brokerage affiliation, and task complexity—contribute relatively more firm-specific rather than industry or market information; 2) Earnings forecasts by low-talent analysts may lead to substantial mispricing; 3) When earnings surprises are large, post-earnings-announcement drift is more prominent among firms covered by low-talent analysts; 4) Firms with low-talent analysts have significantly more insider trading prior to positive earnings news; and 5) Investing following insider trading is more profitable in stocks followed by low-talent analysts.