| Summary: | 碩士 === 國立彰化師範大學 === 財務金融技術學系 === 103 === The focus of this thesis is to investigate the credibility of target price predictions and investment recommendations published in the domestic or foreign security company’s analyst reports for Taiwan stock market. By observing 14,190 report data collected by Taiwan Economics Journal (TEJ) from 2009 to 2013 to und0erstand the prediction successful rate and whether the target price is overshooting or undershooting in each estimate quarters. After analyzing the data results, the overall prediction successful rate for both domestic and foreign security companies is 44.1%, and the first quarter’s prediction successful rate is higher than the other 3 quarters. Furthermore, foreign security company’s prediction successful rate is higher than domestic security company’s prediction successful rate, however, for both domestic and foreign security companies, the negative reports are more accurate than the positive reports. As a result that all security companies prone to be over-optimistic in positive investment recommendation reports, on the other hand, negative investment recommendation reports has higher reliability due to a lower margin in the target price error. In conclusion, foreign and domestic security companies has a tendency to overshoot on the positive investment recommendations, yet, in negative investment recommendations, the overshooting only occur in the first quarter period.
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