Analyst Responsiveness and the Post-Earnings-Announcement Drift

Posted: 30 Apr 2008

See all articles by Yuan Zhang

Yuan Zhang

University of Texas at Dallas

Multiple version iconThere are 2 versions of this paper

Date Written: 2008

Abstract

This study examines the responsiveness of analyst forecasts to current earnings announcements. The results show considerable cross-sectional variation in analyst responsiveness and suggest that this variation is related to the costs and benefits associated with prompt forecast revisions. More importantly, this study finds that with responsive forecast revisions, more of the market reaction takes place in the event window and less in the drift window, suggesting that analyst responsiveness mitigates the post-earnings-announcement drift and facilitates market efficiency.

Keywords: Analyst responsiveness, post-earnings-announcement drift

JEL Classification: G14, G29, M41

Suggested Citation

Zhang, Yuan, Analyst Responsiveness and the Post-Earnings-Announcement Drift (2008). Journal of Accounting & Economics (JAE), Forthcoming. Available at SSRN: https://ssrn.com/abstract=1127064

Yuan Zhang (Contact Author)

University of Texas at Dallas ( email )

P.O. Box 830688
Richardson, TX 75083-0688
United States

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