IPO Anomalies and Analyst’s Selective Forecast

• Main Authors: Ho-Sung Liu, 劉和松
• Other Authors: Yung-Ho Chang
• Format: Others
• Language: zh-TW
• Published: 2007
• Online Access: http://ndltd.ncl.edu.tw/handle/00031213286422034935

碩士 === 東海大學 === 財務金融學系 === 95 === This paper investigates security analysts' prediction ability on the IPO stocks’ future performance by using the US data sets from 1990 to 2004. According to Lim (2001), positive forecast bias exists in an analyst's rational behavior, given the condition of forecast error minimization. We thus assume that earnings forecast bias provides better assessment on analysts’ true forecast volition than do analysts’ forecast coverage. We adopted “Residual Analyst Coverage” model by Somnath et al.(2006) to measure the selective bias. Controlling for firm characteristics and the conflict of interests, we also examine analysts’ ability in forecasting firm performance and the impacts of their opinions on the market.