Where Are the World's Best Analysts?

Abstract

The World’s best equity analysts are based in Asia – these analysts are better at forecasting stock prices than their peers in the US, Europe and the UK. In comparison with the other regions, the performance of buy recommendations made by Asia analysts is superior and consistent over time. The average outperformance of buy recommendations over the medium term is over 4%. Consistent with our other research, buy recommendations outperform sells, but in contrast to Europe, sell recommendations are profitable in Japan. Within the Asia ex-Japan region, we find no significant difference in performance between emerging and developed markets.

Keywords: Analyst forecasts, analyst recommendations, earnings forecasts, Japanese analysts, Asian analysts, sell recommendations, buy recommendations, IBES recommendations

JEL Classification: M41, G14, G24, M40