Abstract

http://ssrn.com/abstract=886180
 
 

Citations (3)



 


 



Conflict in Whispers and Analyst Forecasts: Which One Should Be Your Guide?


Maretno Agus Harjoto


Pepperdine University - Graziadio School of Business and Management

Janis Zaima


San Jose State University - Department of Accounting & Finance

April 7, 2005


Abstract:     
This study examines the market reaction to conflicts that arise when analyst forecast errors are positive (negative) and whisper forecast errors are negative (positive). Results from a subsample, which represents firms with actual EPS that meet/beat the analyst forecast but not whisper, and regression analysis provide evidence that the market reaction to whispers is stronger than the market reaction to analysts. Compared to a portfolio that relies solely on either the analyst forecasts or whispers, a portfolio strategy that uses both information, as well as using whispers when the two conflict, results in higher abnormal returns.

Number of Pages in PDF File: 31

Keywords: Whisper, Analyst forecast, earnings forecast errors, whisper number

JEL Classification: G14, M14, G29, M41

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Date posted: February 28, 2006  

Suggested Citation

Harjoto, Maretno Agus and Zaima, Janis, Conflict in Whispers and Analyst Forecasts: Which One Should Be Your Guide? (April 7, 2005). Available at SSRN: http://ssrn.com/abstract=886180 or http://dx.doi.org/10.2139/ssrn.886180

Contact Information

Maretno Agus Harjoto (Contact Author)
Pepperdine University - Graziadio School of Business and Management ( email )
Drescher Campus Suite 312
24255 Pacific Coast Highway
Malibu, CA 90045
United States
(310) 506-8542 (Phone)
(310) 506-4126 (Fax)
HOME PAGE: http://bschool.pepperdine.edu/faculty/default.php?faculty=maretno_harjoto
Janis Zaima
San Jose State University - Department of Accounting & Finance ( email )
One Washington Square
San Jose, CA 95192-0066
United States
408-924-3490 (Phone)
408-924-3463 (Fax)
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