Analysts' influence on managers' guidance

Kimball Chapman, Jeremiah Ross Green

Research output: Contribution to journalArticle

Abstract

Analysts ask managers for forward-looking information in one-third of quarterly conference calls; most frequently, seeking earnings per share guidance. In this study, we examine the long-term consequences of analysts' questions on future manager disclosure choices. Using six types of commonly provided guidance, we find that when analysts request new guidance or ask about prior guidance, managers are more likely to provide similar guidance in future quarters. When analysts do not ask about prior guidance, managers are less likely to provide that type of guidance in the future. This effect is long-lasting, spills over into earnings announcements, and is strongest for firms with the most severe information problems. Our results provide evidence that analysts shape managers' disclosure choices in meaningful ways.

Original languageEnglish (US)
Pages (from-to)45-69
Number of pages25
JournalAccounting Review
Volume93
Issue number1
DOIs
StatePublished - Jan 1 2018

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Analysts
Managers
Guidance
Disclosure
Spillover
Earnings per share
Earnings announcements
Conference calls

All Science Journal Classification (ASJC) codes

  • Accounting
  • Finance
  • Economics and Econometrics

Cite this

Chapman, Kimball ; Green, Jeremiah Ross. / Analysts' influence on managers' guidance. In: Accounting Review. 2018 ; Vol. 93, No. 1. pp. 45-69.
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Chapman, K & Green, JR 2018, 'Analysts' influence on managers' guidance', Accounting Review, vol. 93, no. 1, pp. 45-69. https://doi.org/10.2308/accr-51778

Analysts' influence on managers' guidance. / Chapman, Kimball; Green, Jeremiah Ross.

In: Accounting Review, Vol. 93, No. 1, 01.01.2018, p. 45-69.

Research output: Contribution to journalArticle

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