The purpose of this paper is to determine how to produce best estimates of intrinsic value, as measured by 36 month abnormal returns, using IBES only forecasts, VL only forecasts, or forecasts from both services. IBES only provides earnings forecasts, while VL provides forecasts of earnings,...

The primary objective of this paper is to assess the gain in valuation accuracy when the analyst performs an exhaustive pro-forma about the target firm beyond the four-year forecast horizon under the direct method, compared to the alternative of using heuristic industry multiples to compute...

Recently, Penman and Sougiannis (1998) and Francis, Olsson and Oswald (1999) compared the bias and accuracy of the dividend discount model (DDM), discounted cash flow model (DCF), and Edwards-Bell-Ohlson residual income model (RIM) in explaining the relation between value estimates and observed...

In this study, we investigate the impact of IFRS adoption in Europe and Australia on the relevance of book value and earnings for equity valuation. Using a sample of 3,488 firms that initially adopted International Financial Reporting Standards (IFRS) in 2005, we are able to compare the figures...

This study examines the impact of voluntary environmental disclosure on the cost of equity capital and firm value, and on the public perception about a firm's environmental performance. A salient feature of the study is that our analysis controls for corporate environmental performance using...

This study examines what factors affect firms' decisions to adopt a proactive environmental strategy and whether pursuing proactive environmental strategies leads to improved financial performance. Using longitudinal data from 1990-2003 for the four most polluting industries in the U.S. (Pulp &...

This study examines the valuation relevance of greenhouse gas emissions under the European Union Carbon Emission Trading Scheme (EU ETS). We posit that carbon emissions affect firm valuation only to the extent that a firm's emissions exceed its carbon allowances under a cap and trade system and...

We hypothesize that firms pursuing a proactive environmental strategy: (1) possess resources and capabilities not available to the other firms and (2) enjoy better financial performance subsequently. Using longitudinal data between 1990 and 2003 from the four most polluting industries in the...

This chapter presents a selected review of studies that speak to the two related questions of whether capital markets view a firm’s carbon emissions as value relevant and if so, the importance of mandated carbon disclosure in facilitating investors’ assessment. The empirical literature...

Previous empirical evidence provided mixed results on the relationship between corporate environmental performance and environmental disclosures. We revisit this relation by testing economics based theories of voluntary disclosure using a more rigorous research design. In particular, we improve...