Chronic bias in earnings forecasts

Financial Analysts Journal

Volumn 62, Issue 1, 2006, Pages 81-96

  Kwag, Seung Woog ^a   Shrieves, Ronald E ^b  

^a UTAH STATE UNIVERSITY   (United States)

^b UNIVERSITY OF TENNESSEE   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 33645662464     PISSN: 0015198X     EISSN: None     Source Type: Journal    
DOI: 10.2469/faj.v62.n1.4060     Document Type: Article

References (29)

1. Abarbanell, Jeffery S. 1991. "Do Analysts' Earnings Forecasts Incorporate Information in Prior Stock Price Changes?" Journal of Accounting and Economics, vol. 14, no. 2 (June):147-165.
2. _. 1999. "A Framework for Analyzing Earnings Management: Implications for Stock Prices, Earnings and Analysts' Forecast Errors." Working paper, University of North Carolina at Chapel Hill.
3. Abarbanell, Jeffery S., and Victor L. Bernard. 1992. "Tests of Analysts' Overreaction/Underreaction to Earnings Information as an Explanation for Anomalous Stock Price Behavior." Journal of Finance, vol. 47, no. 3 (July):1181-1207.
4. Abarbanell, Jeffery S., and Reuven Lehavy. 2003. "Biased Forecasts or Biased Earnings? The Role of Reported Earnings in Explaining Apparent Bias and Over/Underreaction in Analysts' Earnings Forecasts." Journal of Accounting and Economics, vol. 36, nos. 1-3 (December):105-146.
5. Ackert, Lucy F., and George Athanassakos. 1997. "Prior Uncertainty, Analyst Bias, and Subsequent Abnormal Returns." Journal of Financial Research, vol. 20, no. 2 (Summer):263-273.
6. Ali, Ashiq, April Klein, and James Rosenfeld. 1992. "Analysts' Use of Information about Permanent and Transitory Earnings Components in Forecasting Annual EPS." Accounting Review, vol. 67, no. 1 (January):183-198.
7. Ball, Ray, and S.P. Kothari. 1991. "Security Returns around Earnings Announcements." Accounting Review, vol. 66, no. 4 (October):718-738.
8. Bartov, E., D. Givoli, and C. Hayn. 2002. "The Rewards to Meeting or Beating Earnings Expectations." Journal of Accounting and Economics, vol. 33, no. 2 (June):173-204.
9. Bernard, V.L., and J.K. Thomas. 1989, "Post-Earnings-Announcement Drift: Delayed Price Response or Risk Premium?" Journal of Accounting Research, vol. 27, no. 3 (Supplement):1-48.
10. Brown, Lawrence D. 1996. "Analyst Forecasting Errors and Their Implications for Security Analysis: An Alternative Perspective." Financial Analysts Journal, vol. 52, no. 1 (January/February):40-47.
11. Butler, Kirt C., and Larry H.P. Lang. 1991. "The Forecast Accuracy of Individual Analysts: Evidence of Systematic Optimism and Pessimism." Journal of Accounting Research, vol. 29, no. 1 (Spring):150-156.
12. Carleton, Willard, Carl R. Chen, and Thomas L. Steiner. 1998. "Optimism Biases among Brokerage and Non-Brokerage Firms' Equity Recommendations: Agency Costs in the Investment Industry." Financial Management, vol. 27, no. 1 (Spring):17-30.
13. Chari, V.V., Ravi Jagannathan, and Aharon R. Ofer. 1988. "Seasonalities in Security Returns: The Case of Earnings Announcements." Journal of Financial Economics, vol. 21, no. 1 (May):101-121.
14. Conover, W.J. 1980. Practical Nonparametric Statistics. 2nd ed. New York: John Wiley & Sons.
15. Das, Somnath, Carolyn B. Levine, and K. Sivaramakrishnan. 1998. "Earnings Predictability and Bias in Analysts' Earnings Forecasts." Accounting Review, vol. 73, no. 2 (April):277-294.
16. De Bondt, Werner F., and Richard H. Thaler. 1990. "Stock Market Volatility: Do Security Analysts Overreact?" American Economic Review, vol. 80, no. 2 (May):52-57.
17. Degeorge, Francois, Javendu Patel, and Richard Zeckhauser. 1999. "Earnings Management to Exceed Thresholds." Journal of Business, vol. 72, no. 1 (January):1-33.
18. Easterwood, John C., and Stacey R. Nutt. 1999. "Inefficiency in Analysts' Earnings Forecasts: Systematic Misreaction or Systematic Optimism?" Journal of Finance, vol. 54, no. 5 (October):1777-97.
19. Elliot, J., D. Philbrick, and C. Wiedman. 1995. "Evidence from Archival Data on the Relation between Security Analysts, Forecast Errors, and Prior Forecast Revisions." Contemporary Accounting Research, vol. 11, no. 2 (Spring):919-938.
20. Gujarati, Damodar N. 1988. Basic Econometrics. 2nd ed. New York: McGraw-Hill.
21. Huberts, Lex C., and Russell J. Fuller. 1995. "Predictability Bias in the U.S. Equity Market." Financial Analysts Journal, vol. 51, no. 2 (March/April):12-28.
22. Hussain, Simon. 1996. "Over-Reaction by Security Market Analysts: The Impact of Broker Status and Firm Size." Journal of Business Finance and Accounting, vol. 23, nos. 9-10 (December):1223-44.
23. Keane, M., and D. Runkle. 1998. "Are Financial Analysts' Forecasts of Corporate Profits Rational?" Journal of Political Economy, vol. 106, no. 4 (August):768-805.
24. La Porta, Rafael. 1996. "Expectations and the Cross-Section of Stock Returns." Journal of Finance, vol. 51, no. 5 (December):1715-42.
25. Mendenhall, R. 1991. "Evidence of the Possible Underweighting of Earnings-Related Information." Journal of Accounting Research, vol. 29, no. 1 (Spring):170-180.
26. Nutt, Stacey R., John C. Easterwood, and Cintia M. Easterwood. 1999. "New Evidence on Serial Correlation in Analyst Forecast Errors." Financial Management, vol. 28, no. 4 (Winter):106-117.
27. O'Brien, P. 1988. "Analysts' Forecasts as Earnings Expectations." Journal of Accounting and Economics, vol. 10, no. 1 (January):53-83.
28. Scholes, M., and Joseph Williams. 1977. "Estimating Betas from Nonsynchronous Data." Journal of Financial Economics, vol. 5, no. 3 (December):309-327.
29. Soffer, L., and T. Lys. 1999. "Post-Earnings Announcement Drift and the Dissemination of Predictable Information." Contemporary Accounting Research, vol. 16, no. 2 (Summer):305-331.