Do Managers Always Know Better? The Relative Accuracy of Management and Analyst Forecasts

• 成果类型: Article
• 署名作者: Hutton, Amy P.; Lee, Lian Fen; Shu, Susan Z.
• 署名单位: Boston College
• 刊物名称: JOURNAL OF ACCOUNTING RESEARCH
• ISSN/ISSBN: 0021-8456
• DOI: 10.1111/j.1475-679X.2012.00461.x
• 发表日期: 2012
• 页码: 1217-1244
• 关键词: EARNINGS FORECASTS; INFORMATION; performance; disclosure; STREET; COSTS

摘要

We examine the relative accuracy of management and analyst forecasts of annual EPS. We predict and find that analysts information advantage resides at the macroeconomic level. They provide more accurate earnings forecasts than management when a firm's fortunes move in concert with macroeconomic factors such as Gross Domestic Product and energy costs. In contrast, we predict and find that management's information advantage resides at the firm level. Their forecasts are more accurate than analysts when management's actions, which affect reported earnings, are difficult to anticipate by outsiders, such as when the firm's inventories are abnormally high or the firm has excess capacity or is experiencing a loss. Although analysts are commonly viewed as industry specialists, we fail to find evidence that analysts have an information advantage over managers at the industry level. The two have comparable abilities to forecast earnings for firms with revenues or earnings that are more synchronous with their industries.