If target prices reflect the true values of stocks, they should direct prices towards intrinsic values. But analysts’ optimism and use of less sophisticated valuation methods have been found to impede target price informativeness. We find that target price optimism has a positive effect on the...

This paper examines the effect of conditional conservatism (CC) on analysts’ target prices. Due to the long-term nature of target prices, the dynamic effects of CC are more difficult to incorporate in target prices than in earnings forecasts. Accordingly, we expect and find that the effect of...

We investigate whether accounting expertise on audit committees curtails expectations management to avoid negative earnings surprises. Controlling for the endogenous choice of an accounting expert, we find that firms with an accounting expert serving on the audit committee exhibit: (1) less...

The Securities and Exchange Commission (SEC) requires registrants to report interim financial information with their quarterly filings. This information need not be audited, but must be reviewed either quarterly (a timely review) or as part of the year-end audit (a retrospective review). The...

In this study, we argue that data pertaining to a firm's reputation for satisfying stakeholder demands is informative on how both earnings and net book values are associated with firm value. We test our hypotheses on four key stakeholder groups: customers, employees, the community, and the...

This study examines the valuation implications of the ability of firms to mitigate tax increases or sustain tax decreases. We propose that some firms are able to mitigate increases in taxes faster and sustain decreases in taxes longer than other firms. We investigate that conjecture by...