|
|||||
|
|
Model-based earnings forecasts vs. financial analysts' earnings forecasts |
|
| Institution: | 1. School of Business and Economics, Loughborough University Epinal Way, Loughborough, LE11 3TU, UK;2. Michael Smurfit Business School, University College Dublin, Carysfort Avenue, Blackrock, Co. Dublin, Ireland;3. Alliance Manchester Business School, University of Manchester, Booth Street West, Manchester, M15 6PB, UK;1. School of Management, Royal Holloway, University of London, Egham Hill, Egham, TW200EX, UK;2. Department of Business and Law, University of Siena, P.zza San Francesco 7/8, 53100, Siena, Italy;1. International Business School Suzhou, Xi''an Jiaotong-Liverpool University, China;2. School of Management, University of Bradford, UK;3. Salford Business School, University of Salford, UK;1. School of Accounting, UNSW Business School, UNSW Sydney, 2052 Australia;2. Discipline of International Business, Business School, The University of Sydney, NSW, 2006, Australia |
| Abstract: | Existing accounting-based forecasting models of earnings either do not fully consider information that is contained in stock prices or use an ad hoc specification that is not based on rigorous valuation theory. In this paper, we develop an earnings forecasting model built on the theoretical linkages between future earnings and stock prices as well as a number of accounting fundamental variables. We find that our model-based forecasts of earnings are in general less biased and more accurate than both existing model-based forecasts and analysts' consensus forecasts, at both shorter and longer horizons. We also show that the accuracy of both model-based forecasts and financial analysts' forecasts depend on firm-specific characteristics such as firm size and industry membership. |
| Keywords: | Analysts' earnings forecasts Model-based earnings forecasts Forecast horizons Accuracy Incremental information Firm characteristics |
| 本文献已被 ScienceDirect 等数据库收录！ | |