Geographic proximity and analyst coverage decisions: Evidence from IPOs

• 成果类型: Article
• 署名作者: O'Brien, Patricia C.; Tan, Hongping
• 署名单位: University of Waterloo; York University - Canada
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2014.11.002
• 发表日期: 2015
• 关键词: SELL-SIDE ANALYSTS; BANKING RELATIONSHIPS; INVESTOR RECOGNITION; MARKET-SEGMENTATION; Domestic investors; EARNINGS FORECASTS; foreign analysts; stock returns; asset prices; INFORMATION

摘要

Using hand-collected data on analyst locations, we study how geographic proximity affects analyst coverage decisions for U.S. firms that went public during 1996-2009, along with the impact of local coverage on firm visibility. Analysts are 80% more likely to cover local firms than non-local ones, and nearby non-underwriter analysts initiate coverage one to three weeks earlier than distant ones. Proximity matters most for smaller, less visible firms, for firms with less complex operations and for lower status analysts. Less visible firms may use local analyst coverage as a stepping-stone to increase visibility with other analysts and institutional investors. (C) 2014 Elsevier B.V. All rights reserved.