We examine the value of analyst Free Cash Flow (FCF) forecasts in the context of target price changes. We argue that investors can use FCF forecasts to distinguish between FCF based target price changes and less informative target price changes primarily driven by discount rate, long term growth...

We examine a set of equity analysts' private models from a large investment bank equity research department as a new way of understanding how analysts actually value the companies their follow. We identify their valuation approaches and use of inputs, including equity research premium, risk free...