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Analyst earnings forecast trends in Pacific Rim countries

Stephen J. Ciccone (University of New Hampshire, Whittemore School of Business and Economics, McConnell Hall, 15 College Road, Durham, New Hampshire)
Ahmad Etebari (University of New Hampshire, Whittemore School of Business and Economics, McConnell Hall, 15 College Road, Durham, New Hampshire)

Managerial Finance

ISSN: 0307-4358

Article publication date: 1 July 2004

Abstract

This study analyzes trends in analyst forecast properties from 1987 through 1998 in the United States and seven Pacific Rim countries: Australia, New Zealand, Taiwan, Hong Kong, Japan, South Korea, and Thailand. Analyst forecast properties in the United States have become less dispersed, more accurate, and less optimistic during the sample period. Similar trends exist in Australia and New Zealand, but not in the other sample countries. In contrast, the forecast property trends of most Asian countries are the exact opposite. For example, in Japan and Korea, forecast dispersion, forecast error, and optimism all significantly increase over the sample period. The results suggest that Asian firms do not play the U.S.‐style earnings game in which managers guide analysts toward a certain target number and then report earnings that beat the target.

Keywords

Citation

Ciccone, S.J. and Etebari, A. (2004), "Analyst earnings forecast trends in Pacific Rim countries", Managerial Finance, Vol. 30 No. 7, pp. 19-35. https://doi.org/10.1108/03074350410769155

Publisher

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Emerald Group Publishing Limited

Copyright © 2004, Emerald Group Publishing Limited