The Quality of Analysts' Earnings Forecasts During the Asian Crisis: Evidence from Singapore

Author First name, Last name, Institution

Roger K. Loh
G. Mujtaba Mian

Document Type

Article

Source of Publication

Journal of Business Finance & Accounting

Publication Date

9-9-2003

Abstract

We bring together three disparate strands of literature to develop a comprehensive empirical framework to examine the efficiency of security analysts' earnings forecasts in Singapore. We focus specifically on how the increased uncertainty and the negative market sentiment during the period of the Asian crisis affected the quality of earnings forecasts. While we find no evidence of inefficiencies in the pre-crisis period, our results suggest that after the onset of the crisis, analysts (1) issued forecasts that were systematically upward biased; (2) did not fully incorporate the (negative) earnings-related news; and (3) predicted earnings changes which proved too extreme.

ISSN

0306-686x; 14685957

Publisher

Wiley-Blackwell

Volume

30

First Page

749

Last Page

770

Disciplines

Business

Indexed in Scopus

no

Open Access

no

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