We use the k-nearest neighbors (i.e., k-NN) algorithm to forecast a firm’s annual earnings by matching its recent trend in annual earnings to historical earnings sequences of “neighbor” firms. Our forecasts are more accurate than forecasts obtained from the random walk, the regression...

Other comprehensive income (OCI) items are often considered to be transitory (Chambers et al. 2007; IASB 2013; CFA2014). In this paper we show that a significant portion of OCI, namely unrealized gains and losses (UGL) from available-for-sale (AFS) debt securities, is non-transitory: a negative...

Recent literature has used analysts' earnings forecasts, which are known to be optimistic, to estimate implied expected rates of return; yielding upwardly biased estimates. We estimate that the bias, computed as the difference between the estimates of the implied expected rate of return based on...