Contents

Meeting or Beating Analysts’ Forecasts: Empirical Evidence of Firm’s Characteristics, and Persistence Patterns

Choi, Tae Hee

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Abstract

Focusing on the MBE (meeting or beating analysts’ forecast) phenomenon,this study primarily investigates the way market responds to a firm’s repeated MBE and to its first failure to meet analysts’ forecast after a long string of MBE. The paper also asks whether the market’s reaction to the MBE patterns has changed after the regulatory reform including the Sarbanes-Oxley Act and investigates the properties of habitual MBE firms.
The results show the market rewards persistent MBE firms and that it seems to efficiently interpret a systematic portion of earnings surprise for habitual beaters. They also document that the post-SOX stock market premium to MBE has not completely diminished and that MBE patterns are strongly associated with firm characteristics.

Issue Date
2010
Publisher
서울대학교 경영대학부속경영연구소
Keywords
Analysts’ forecasts; earnings management; forecast management; Sarbanes-Oxley Act; firm characteristics
URL
http://hdl.handle.net/10371/75576
Journal Title
SEOUL JOURNAL OF BUSINESS
Start Page
3
End Page
38
ISSN
1226-9816
Language
English
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