Corporate Disclosure Policy and Analyst Behavior
This paper examines the relations between the disclosure practices of firms, the number of analysts following each firm and properties of the analysts' earnings forecasts. Using data from the Report of the Financial Analysts Federation Corporate Information Committee (FAF Report 1985-89), we pr...
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| Veröffentlicht in: | The Accounting review 1996-10, Vol.71 (4), p.467-492 |
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| creator | Lang, Mark H. Lundholm, Russell J. |
| description | This paper examines the relations between the disclosure practices of firms, the number of analysts following each firm and properties of the analysts' earnings forecasts. Using data from the Report of the Financial Analysts Federation Corporate Information Committee (FAF Report 1985-89), we provide evidence that firms with more informative disclosure policies have a larger analyst following, more accurate analyst earnings forecasts, less dispersion among individual analyst forecasts and less volatility in forecast revisions. The results enhance our understanding of the role of analysts in capital markets. Further, they suggest that potential benefits to disclosure include increased investor following, reduced estimation risk and reduced information asymmetry, each of which have been shown to reduce a firm's cost of capital in theoretical research. |
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Further, they suggest that potential benefits to disclosure include increased investor following, reduced estimation risk and reduced information asymmetry, each of which have been shown to reduce a firm's cost of capital in theoretical research.</description><subject>Accounting</subject><subject>Analytical forecasting</subject><subject>Annual reports</subject><subject>Business structures</subject><subject>Capital costs</subject><subject>Capital market</subject><subject>Control variables</subject><subject>Disclosure</subject><subject>Earnings forecasting</subject><subject>Economic behaviour</subject><subject>Financial analysis</subject><subject>Financial management</subject><subject>Financial policy</subject><subject>Financial statement analysis</subject><subject>Investment advisors</subject><subject>Investor relations</subject><subject>Investors</subject><subject>Market value</subject><subject>Standard 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| identifier | ISSN: 0001-4826 |
| ispartof | The Accounting review, 1996-10, Vol.71 (4), p.467-492 |
| issn | 0001-4826 1558-7967 |
| language | eng |
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| source | Jstor Complete Legacy; Business Source Complete; Periodicals Index Online |
| subjects | Accounting Analytical forecasting Annual reports Business structures Capital costs Capital market Control variables Disclosure Earnings forecasting Economic behaviour Financial analysis Financial management Financial policy Financial statement analysis Investment advisors Investor relations Investors Market value Standard deviation Studies Subcommittees |
| title | Corporate Disclosure Policy and Analyst Behavior |
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