Do Analysts Gain an Informational Advantage by Visiting Listed Companies?

• 成果类型: Article
• 署名作者: Han, Bing; Kong, Dongmin; Liu, Shasha
• 署名单位: University of Toronto; Southwestern University of Finance & Economics - China; Zhongnan University of Economics & Law; Huazhong University of Science & Technology; Jinan University
• 刊物名称: CONTEMPORARY ACCOUNTING RESEARCH
• ISSN/ISSBN: 0823-9150
• DOI: 10.1111/1911-3846.12363
• 发表日期: 2018
• 页码: 1843-1867
• 关键词: forecast accuracy; CONFERENCE CALLS; performance; management; investors; improve; BIAS

摘要

We examine the improvements in forecast accuracy that result from analysts' visits to listed companies. We find that company visits significantly enhance the accuracy of the analysts' earnings forecasts for those companies. The benefit from company visits is more pronounced for companies that are more neglected or less accessible and for brokerage firms that face less pressure for optimistic forecasts from buy-side clients. Our results are robust and remain significant after controlling for endogeneity and selection bias. Overall, our findings show that private interactions with company management provide analysts with an informational advantage and suggest that company visits facilitate the mosaic approach to information acquisition.