Analyst Coverage Overlaps and Interfirm Information Spillovers

• 成果类型: Article
• 署名作者: Martens, Tim; Sextroh, Christoph J.
• 署名单位: City St Georges, University of London; Tilburg University
• 刊物名称: JOURNAL OF ACCOUNTING RESEARCH
• ISSN/ISSBN: 0021-8456
• DOI: 10.1111/1475-679X.12391
• 发表日期: 2021
• 页码: 1425-1480
• 关键词: patent citations; knowledge spillovers; industry expertise; CONFERENCE CALLS; MARKET; management; INNOVATION; side; COMPETITION; selection

摘要

We offer a novel perspective on the role of sell-side analysts as information intermediaries in capital markets by documenting a flow of information in a new direction, namely, from analysts to the firms they cover. We use analyst coverage overlaps and patent citations to examine analyst-induced information spillovers about technology and industry trends. Consistent with analyst coverage-related information flows, firms are more likely to cite another firm's patent if that firm is covered by the same analyst. The effect varies with analysts' specialization, experience, and level of activity. Firms with more analyst-based connections to peers also show greater corporate innovation. Collectively, our evidence indicates that financial analysts not only reduce information asymmetries between firms and capital market participants but also facilitate the production of business intelligence through feedback and interfirm information spillovers.