Do analysts who understand accounting conservatism exhibit better forecasting performance?
- Authors
- Jung, Jay Heon; Lim, Sonya S.; Pae, Jinhan; Yoo, Choong-Yuel
- Issue Date
- 7월-2017
- Publisher
- WILEY
- Keywords
- asymmetric timely loss recognition; career outcome; conditional conservatism; equity analyst; forecasting performance; stock recommendation
- Citation
- JOURNAL OF BUSINESS FINANCE & ACCOUNTING, v.44, no.7-8, pp.953 - 985
- Indexed
- SSCI
SCOPUS
- Journal Title
- JOURNAL OF BUSINESS FINANCE & ACCOUNTING
- Volume
- 44
- Number
- 7-8
- Start Page
- 953
- End Page
- 985
- URI
- https://scholar.korea.ac.kr/handle/2021.sw.korea/82891
- DOI
- 10.1111/jbfa.12254
- ISSN
- 0306-686X
- Abstract
- This study investigates the performance of analysts when they match the asymmetric timeliness of their earnings forecast revisions (i.e., asymmetric forecast timeliness) with the asymmetric timeliness of firms' reported earnings (i.e., asymmetric earnings timeliness). We find that better timeliness-matching analysts produce more accurate earnings forecasts and elicit stronger market reactions to their forecast revisions. Further, better timeliness-matching analysts issue less biased earnings forecasts, more profitable stock recommendations and have more favorable career outcomes. Overall, our results indicate that analysts' ability to incorporate conditional conservatism into their earnings forecasts is an important reflection of analyst expertise and professional success.
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Collections - Korea University Business School > Department of Business Administration > 1. Journal Articles
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