Empirical Study On Financial Analyst Forecasts Of Listed Companies Costs Viscous Effect

With the advancements of cost behavior, cost stickiness has become a new research direction in management accounting. Understanding cost stickiness contributes to enterprise cost management, analysts’earnings forecasts and investors’decision-making. Considering the more important role that financial analysts’earnings forecasts play in the capital market, this paper aims to probe into the influence of company cost stickiness on financial analysts’earnings forecasts by the full and accurate data of the listed companies, so as to provide preliminary evidence to financial analysts industry, the future research work and management practice.Firstly, the paper analyzed the theoretical basis and reviewed the related research from domestic and foreign scholars in detail. In view of the theoretical analysis, the paper put forward the hypotheses for empirical research in the correlation between cost stickiness and analysts’ earnings forecast. Based on the effective sample data of Shenzhen Stock Exchange A Share Market from2002to2011, this paper measures the level of company cost stickiness and tests the relationship between company cost stickiness and financial analysts’earnings forecasts respectively from three aspects:the accuracy of analysts’earnings forecasts, analysts’dispersion and analyst following. The empirical research conclusion of this paper indicates that the company cost stickiness has an influence on the properties of analysts’forecasts in general. Specifically, stickier cost behavior results in less accurate analysts’earnings forecasts and more different views between analysts. The reason is company cost stickiness makes the uncertainty of earnings forecasts raise, thus affecting financial analyst earnings forecast results. This paper also finds that company cost stickiness has no statistically significant relationship with analyst following. Above conclusion shows that identifying and evaluating the cost stickiness of listed companies helps financial analysts to raise their earnings forecasts accuracy and reduce the disagreement between analysts, thus contributing to improvement of analysts industry in our country.