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Sell-Side Debt AnalystsStanimir MarkovUniversity of Texas at Dallas - Naveen Jindal School of Management Rick JohnstonPurdue University - Department of Accounting Sundaresh RamnathUniversity of Miami - Department of Accounting February 15, 2008 Abstract: We study the determinants and market impact of sell-side debt research. Analyzing a sample of 5,920 debt reports published by fifteen brokerage firms from 1999 to 2004, we document that companies with a higher probability of financial distress, lower market-to-book ratio, larger debt, and higher leverage receive more debt research. In addition, we document higher frequency of debt reports around credit ratings downgrades and find that their publication impacts equity prices. The evidence enhances our understanding of the nature of the market forces shaping sell-side debt research and its effect on price formation.
Number of Pages in PDF File: 50 Keywords: Debt, Information Intermediaries, Distress, Analyst JEL Classification: G14, G24, G29, working papers seriesDate posted: March 25, 2007 ; Last revised: February 19, 2008Suggested CitationContact Information
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