TITLE:
Does Benefit Relationship Affect Analysts’ Earnings Forecast?—Evidence from Chinese Stock Market
AUTHORS:
Yinlin Ou
KEYWORDS:
Securities Analysts, Benefit Relationship, Earnings Forecasts
JOURNAL NAME:
Open Journal of Accounting,
Vol.6 No.2,
April
28,
2017
ABSTRACT: Under the information
asymmetrical theory, the Chinese securities analysts are affected by many
benefit factors, so the purpose of the study is trying to figure out what benefit elements and how to
affect analysts’ earnings forecasts. Using data from 2012 to 2015, the author creatively quantifies interest
factors, and does the empirical analysis. Regression results indicate that the closer relationship
between securities analysts and the listed companies management or
institutional investors, the greater accuracy of their earnings forecasts.
Besides, analysts’ reputation exists a negative correlation between earnings forecasts accuracy. Furthermore, securities’
underwriting relationships have no significant influence on the accuracy of analysts’
earnings forecasts, but the underwriting analysts are more likely to
overestimate earnings per share of the target companies.