| Summary: | 碩士 === 東海大學 === 會計學系 === 93 === Past studies provide a decent foundation for analyzing IPO performance. Also established is the connection between underwriting relationships and analysts’ opinions. This research explores more thoroughly the influence of the underwriting relationships on analysts’ forecasting behavior for IPO issuing firms. The effect of analysts’ reputation on the forecast bias is also examined by controlling for underwriting relationships. The samples consist of 21,307 earnings forecasts issued by financial analysts on the 765 issuing companies that went public from January 1998 through December 2002.
The empirical results provide that analysts’ forecast accuracy is associated with underwriting relationships. Lead underwriters are less optimistic and issue more accurate earnings forecasts than do co-underwriters and unaffiliated underwriters. In addition, when considering the effect of reputation, analysts are likely to place a higher weight on the financial incentives conveyed by underwriting relationships and thus issue more biased earnings forecasts. Likewise, lead underwriters and co-underwriters with a higher reputation tend to be less accurate than those without a higher reputation.
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