Changes in the Behavior of Earnings Surprise: International Evidence & Implications
Ron Bird () and
Published Paper Series from Finance Discipline Group, UTS Business School, University of Technology, Sydney
Earnings surprise has been shown to be an important driver of the underreaction/overreaction price response of stocks to new information. The received wisdom has been that financial analysts' forecasts have typically been optimistic, resulting in a negative bias in earnings surprise. In an international study of trends between 1976 and 1999, the authors suggest a change in the behavior of earnings surprise. In the U.S. market, analysts have become quite pessimistic in their earnings forecasts, and an increasing number of U.S. firms have announced small positive earnings surprises; the findings in Japan are exactly the opposite. A major driving force behind differences in behavior has been the relative state of the two economies, and in the U.S. growth in the use of stock options has caused management to be more interested in boosting the short-term share price.
Pages: 14 pages
References: Add references at CitEc
Citations: Track citations by RSS feed
Published in: Bird, R. and McKinnon, J., 2001, "Changes in the Behavior of Earnings Surprise: International Evidence & Implications", Journal of Investing, 10(3), 19-32.
Downloads: (external link)
Access to full text is restricted to subscribers.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:uts:ppaper:2001-1
Access Statistics for this paper
More papers in Published Paper Series from Finance Discipline Group, UTS Business School, University of Technology, Sydney PO Box 123, Broadway, NSW 2007, Australia. Contact information at EDIRC.
Bibliographic data for series maintained by Duncan Ford ().