A Review of Research Related to Financial Analysts' Forecasts and Stock Recommendations
University of Miami - Department of Accounting
University of Colorado at Boulder - Department of Accounting
Philip B. Shane
University of Virginia - McIntire School of Commerce; University of Auckland - Faculty of Business & Economics
June 30, 2008
This paper reviews research regarding the role of financial analysts in capital markets. The paper builds on the perspectives provided by Schipper (1991) and Brown (1993). We categorize papers published mainly since 1992 and selectively discuss aspects of these papers that address or suggest key research topics of ongoing interest in seven broad areas: analysts' decision processes, the determinants of analyst expertise and distributions of individual analysts' forecasts, the informativeness of analysts' research outputs, analyst and market efficiency with respect to information, effects of analysts' economic incentives on their research outputs, effects of the institutional and regulatory environment (including cross-country comparisons), and the limitations of databases and various research paradigms.
Number of Pages in PDF File: 117
Keywords: Financial analyst forecasts, analyst recommendations
JEL Classification: G29, G14, G15, M41, M47working papers series
Date posted: November 16, 2005 ; Last revised: April 27, 2010
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