Reputation and Performance Among Security Analysts

Members of the Institutional Investor All-American Research Team supply more accurate earnings forecasts than other analysts when forecasts are matched by the corporation followed and by the date of brokerage house issuance. This contemporaneous advantage is complemented by a timing advantage; All-A...

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Bibliographic Details
Published in:The Journal of finance (New York) 1992-12, Vol.47 (5), p.1811-1836
Main Author: STICKEL, SCOTT E.
Format: Article
Language:English
Subjects:
Analytical forecasting
Brokerage houses
Business structures
Calendars
Coefficients
Compensation
Earnings
Earnings forecasting
Forecasts
Investment advisors
Polls
Regression coefficients
Reputations
Securities analysis
Security prices
Statistical median
Statistical significance
Stock returns
Studies
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Summary:Members of the Institutional Investor All-American Research Team supply more accurate earnings forecasts than other analysts when forecasts are matched by the corporation followed and by the date of brokerage house issuance. This contemporaneous advantage is complemented by a timing advantage; All-Americans supply forecasts more often than other analysts. Stocks returns immediately following large upward forecast revisions suggest that All-Americans impact prices more than other analysts. However, there is virtually no difference in returns following large downward revisions. Nevertheless, the collective results suggest a positive relation between reputation and performance, and, assuming that All-Americans are better paid, pay and performance.
ISSN:0022-1082
1540-6261
DOI:10.1111/j.1540-6261.1992.tb04684.x