Does analyst ranking affect how informative target prices are to institutional investors?

Hashim, Noor (2015) Does analyst ranking affect how informative target prices are to institutional investors? Working Paper. The Department of Accounting and Finance, Lancaster.

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Abstract

Evidence shows that market participants value analysts’ target prices. There is limited evidence, however, on how target price revisions influence investors’ decisions. I examine whether analyst ranking status affects institutional investors’ decisions to incorporate target price information into their investment strategies. This examination is relevant to the economic question: Does analyst reputation mitigate or exacerbate the conflicts of interest that analysts face? Consistent with institutional investor trades being based on superior information, I observe differences in the information content of target price revisions by star and non-star analysts. Additionally, a duration analysis shows that low target price quality significantly increases the hazard of institutional investors not voting analysts as ‘stars’.

Item Type: Monograph (Working Paper)
Departments: Lancaster University Management School > Accounting & Finance
ID Code: 74614
Deposited By: ep_importer_pure
Deposited On: 13 Jul 2015 08:26
Refereed?: No
Published?: Published
Last Modified: 20 Feb 2020 00:27
URI: https://eprints.lancs.ac.uk/id/eprint/74614

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