Earnings Forecasts: The Bias Is Back

Roy Batchelor

Foresight: The International Journal of Applied Forecasting, 2017, issue 45, 5-9

Abstract: A recent study reported in The Economist reveals that, early in each calendar year, financial analysts consistently overestimate the annual earnings of U.S. companies, a dramatic forecasting bias that is only partly corrected later in the year. In this article, Foresight's Financial Forecasting Editor, Roy Batchelor, probes the sources of these "earnings surprises" and concludes that it all has to do with misplaced incentives. It's a problem not very different from the kind every business forecaster faces when "the boss" implicitly (or explicitly) requests a more favorable result from the forecast than the data can permit. Copyright International Institute of Forecasters, 2017

Date: 2017
References: Add references at CitEc
Citations:

Downloads: (external link)
https://foresight.forecasters.org/shop/

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:for:ijafaa:y:2017:i:45:p:5-9

Access Statistics for this article

More articles in Foresight: The International Journal of Applied Forecasting from International Institute of Forecasters Contact information at EDIRC.
Bibliographic data for series maintained by Michael Gilliland ().