| After nearly 30 years of development,China's securities market has become an important support to serve the real economy.At present,China's economy is turning to the stage of high-quality development,and it is more necessary to establish a high-quality capital market,give full play to the function of resource allocation,and improve the efficiency of financial offering services to the enterprise.As the backbone of information transmission,securities analysts' mission is to alleviate information asymmetry,which is of great significance for cultivating open,transparent,standardized and efficient capital market.However,the emergence of “research reporting” events in the securities analysis industry severely interferes with the effective of information transmission in the capital market and reduces the efficiency of resource allocation.The reason lies in the fact that the quality of securities analysts is uneven,their research ability is insufficient,and their work fails to do their due diligence.As a result,the quality of research reports is low.It is urgent to improve the professional level and professional quality of analysts.A number of recent literature studies have shown significant differences in the personal abilities of analysts,with industry expertise reflecting the expertise or expertise of analysts in a particular industry as the most important personal characteristic factor affecting the quality of earnings forecasts and careers.Currently,domestic and foreign literature on the analyst industry expertise is still limited,and our understanding of how industry expertise affects analyst forecasting behaviors is still unclear.Industry concentration is an important external operating environment for the survival and development of enterprises,which directly affects the cost and benefit of corporate information disclosure.It provides a good experimental situation for us to understand the functional mechanism of analyst industry expertise from the perspective of mining more corporate information.Based on China's capital market in transformation period and the present development situation of securities analyst industry,taking the impact of industry expertise on analysts' earnings forecast behavior as logical line,from three dimensions of the analysts forecast revisions,cash flow forecasts and earnings forecast accuracy respectively,this paper studies the influence of industry expertise on analysts' earnings forecast behavior under different industry concentration and its economic consequences.Our study enriches the existing research related to analyst behaviors,which is limited to the enterprise level and pay less attention to analyst personal characteristics,especially analyst industry expertise.The main content and research conclusion of this paper are as follows:Firstly,a brief introduction is given in the introduction.From the current situation that the function of information transfer for China's securities analysts is still need to improve,this paper expounds the importance of industry expertise in cultivating the professional ability of analysts and helping investors identify the quality of research reports,which gives the research background and significance of this paper.Then,the research contents,structure and methods of this paper are introduced,and the research framework of this paper is summarized.Finally,based on the positive role of industry concentration as a research perspective in understanding analyst industry expertise,this paper introduces the differences with previous literature and the possible innovations.Secondly,the basic theory is expounded and related literature is reviewed.Firstly,the second chapter of this paper summarizes the main theories related to the research content of this paper,including the information asymmetry theory and signal transmission theory related to analyst prediction,the learning by doing theory and the division of labor and specialization theory related to analyst industry expertise,and the proprietary cost theory of information disclosure related to industry concentration.Then,this paper reviews the information sources of analyst earnings forecasting and the related literature of analyst industry expertise from the perspective of analyst industry expertise.From the perspective of analyst forecast,this paper reviews the literatures related to analyst forecast revision,analyst cash flow forecast and analyst forecast accuracy.The literatures related to industrial concentration is reviewed from the perspective of enterprise information disclosure.This second chapter outlines the theoretical framework and literature basis.Thirdly,the institutional background analysis is carried out to provide practical basis for the empirical analysis.The third chapter analyzes the development process,present status and forecast behavior characteristics of China's analyst industry.This chapter finds that China's securities analysis industry has experienced a period of rapid growth,but the growth trend has slowed down.China's analyst industry is stepping into the transition period,and the capital market is plagued by noise.Then,based on the development status of the analyst industry and the analyst forecast characteristics,this paper summarizes many problems in the development of analyst industry,such as the homogeneity of securities company's business,weak ability of the analyst,and lack of regulation of analyst behavior.Fourthly,from the three dimensions of the revision range,cash flow forecast and forecast accuracy of analyst forecast,theoretical analysis and empirical test have been conducted to examine the impact of analyst industry expertise on their earnings forecast behavior under the difference of industry concentration.Industry expertise is an important personal characteristic of analysts.However,there is still lack a comprehensive understanding of the impact of industry expertise on analyst earnings behavior,especially the impact of industry concentration on the function of analyst industry expertise.Through the researches in chapter 4,5 and 6,this paper finds that the industry expertise helps to improve the earnings analysis ability of analysts.Analysts with industry expertise have the ability or low cost to obtain information from the competitors in same industry,thus showing different forecasting tendency than other analysts.Further,in industries with high product market concentration products,the interdependence and competition between enterprises is more closely.Thus,the operating conditions,product cost and price information offered by other companies in the same industry contain less noise and more substantive information,which can play a greater role in analyst earnings analysis.As a result,the influence of industry expertise to analysts' forecast behavior is significantly strengthened.The concrete manifestation is as follows: 1.Analyst with industry expertise is bolder in revising earnings forecast,more likely to issue additional cash flow forecast and more accurate;2.Because the spillover effect of common and competitive information in more concentrated industries is significantly incresed,the willingness of industry expertise analysts to revise earnings forecast boldly and release cash flow forecast is significantly enhanced,as well as the forecast accuracy.The results obtained by using alternative measurements of key variables and using the change model also support the above conclusions.3.Further,to understand the potential mechanism,we also studied how the enterprise information disclosure characteristics affect the complementary effect of industry concentration and industry expertise in analyst forecast.We find that this complementary effect is mainly found in the firms with lower level of information disclosure,without detailed customers suppliers information and without management forecast information.Fifth,from the perspective of earnings forecast correction and cash flow forecast,the market reaction of analysts with industry expertise is studied by theoretical analysis and empirical analysis.In chapter 7,this paper finds that analysts with industry expertise have higher market reaction.However,as product market concentration increases,the market reaction of analysts' industry expertise has not increased significantly.The concrete manifestation is as follows: 1.for analysts with industry expertise,their earnings forecast revision and cash flow forecast can bring greater market reaction;2.Increased industry concentration has not enhanced market reaction to earnings forecast revisions and cash flow forecasts by analysts with industry expertise.It indicates that investors are not aware of the difference in the function of analysts' industry expertise under different industry concentration.Sixth,research enlightenment,conclusion and prospect.ln this paper,based on the previous research conclusions,chapter 8 presents some enlightenments to government departments from the capital market regulation of public opinion,property rights protection of analysts study report,norms of market competition and improvement of the enterprise information disclosure system.In addition,this chapter gives some enlightenments to investors from improvement of ability in discriminating information authenticity,strengthening of right-protection awareness and establishing of value investment ideal.This chapter also gives the enlightenment to securities companies and analysts from the cultivating of analysts' industry expertise.After summarizing the conclusions of in this paper,chapter 9 points out the deficiencies of this research,and makes some assumptions on the future research direction. |
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