Analyst Tipping: Additional Evidence

22 Pages Posted: 27 May 2020

See all articles by Stanimir Markov

Stanimir Markov

University of Texas at Dallas - Naveen Jindal School of Management

Volkan Muslu

C.T. Bauer College of Business University of Houston

Musa Subasi

University of Maryland-College Park - Robert H. Smith School of Business

Multiple version iconThere are 2 versions of this paper

Date Written: January/February 2017

Abstract

We examine whether analysts tip investors during investor conferences. We find that conference‐day abnormal returns of a presenting company are about 0.6% higher when the conference is hosted by an analyst who will initiate coverage with a Buy recommendation than when the conference is hosted by non‐initiating analysts. Furthermore, conference‐day abnormal returns of the presenting company amount to half of the price run‐up during the 20 trading days prior to the Buy initiation. Finally, there is a statistically and economically significant price run‐up prior to a Sell initiation (by about –0.7%) when the analyst who will initiate coverage with a Sell recommendation hosts a conference but does not invite the company to present. Our findings collectively suggest that analysts, rather than companies, tip select investors about upcoming initiations during conferences.

Keywords: investor conferences, equity analysts

Suggested Citation

Markov, Stanimir and Muslu, Volkan and Subasi, Musa, Analyst Tipping: Additional Evidence (January/February 2017). Journal of Business Finance & Accounting, Vol. 44, Issue 1-2, pp. 94-115, 2017, Available at SSRN: https://ssrn.com/abstract=3604464 or http://dx.doi.org/10.1111/jbfa.12231

Stanimir Markov (Contact Author)

University of Texas at Dallas - Naveen Jindal School of Management ( email )

P.O. Box 830688
Richardson, TX 75083-0688
United States
972 883 5166 (Phone)

Volkan Muslu

C.T. Bauer College of Business University of Houston ( email )

4750 Calhoun Road
Houston, TX 77204
United States
713 7434924 (Phone)

Musa Subasi

University of Maryland-College Park - Robert H. Smith School of Business ( email )

University of Maryland-College Park
4332N Van Munching Hall
College Park, MD 20742
United States
301-314-1055 (Phone)

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