We propose a novel method to forecast corporate earnings, which combines the accuracy of analysts’ forecasts with the unbiasedness of a cross-sectional model. We build on recent insights from the earnings forecasts literature to improve analysts’ forecasts in two ways: reducing their...

In this study we examine changes in the precision and the commonality of information contained in individual analysts' earnings forecasts, focusing on changes around earnings announcements. Using the empirical proxies suggested by the Barron et al. (1998) model that are based on the...

This study examines how the quality of corporate disclosures impacts the precision of information that financial analysts incorporate into their forecasts of upcoming annual earnings. Our empirical measures distinguish between the precision of individual analysts' common and idiosyncratic...

Using the setting of extreme mutual fund flow-driven trading pressure, this paper examines sell-side analysts' role in stabilizing capital markets. We find that a select group of analysts persistently issue price-correcting recommendation changes for stocks experiencing mutual fund flow-driven...

We use exogenous decreases in analyst coverage to examine how firm-specific analyst coverage affects media coverage. The loss of analyst information, on which journalists rely, raises the costs of developing a news article. Simultaneously, the loss reduces competition in the market for public...

Using unique data on brokerage-firm trading volume, I examine whether analysts' earnings forecasts and recommendations generate trading volume for their brokerage firms. I find that analysts' forecasts differing from the consensus forecast generate signif icant brokerage-firm volume in the...

This study compares the earnings forecasts of analysts employed by independent research firms to those of analysts employed by investment banks along the dimensions of accuracy and optimism. We discuss the conflicts of interest faced by both groups and suggest that, despite incentives stemming...

I examine the role of analysts in providing heterogeneous interpretations of public disclosures, specifically earnings announcements. Consistent with the predictions of Indjejikian's (1991) model, I document that there are relatively more heterogeneous interpretations in the forecast revisions...

We document several factors that help explain cross-sectional variations in the delayed price response to individual analyst forecast revisions. First, the market does not make a sufficient distinction between those analysts providing new information and others simply quot;herdingquot; toward...

We examine the effect of signal attributes and analyst identity on the price impact of an earnings forecast revision. We measure the price impact immediately upon the release of a forecast, as well as over the next twenty-four months. We find that an analyst's own prior forecast and the...