Institutional Investors And Analysts' Earnings Forecast

Analysts play an important role in accelerating the information transfer in the capital market.They will collect the listed company information and conduct professional analysis and interpretation to obtain more comprehensive financial analysis data and future earnings forecast information.When making investment decisions,investors will use the analyst's forecast as a reference to select the stocks they want to hold.This will make social capital flow to enterprises with better development capabilities,increase the information content of these companies' stocks,and increase capital.The operational efficiency of the market solves the funding problem for companies that need to develop and have strong profitability.Therefore,in the context of the rapid economic development,how to give full play to the analyst's forecasting function is extremely important for guiding the benign operation of capital.Institutional investors have the motivation,conditions and capabilities to participate in corporate governance,mainly in terms of their unique advantages in terms of size,capital and professionalism.Therefore,it plays an increasingly important and positive role in supervising the company's daily behavior,improving the return on capital,reducing information asymmetry,improving the quality of accounting information,and improving corporate governance.Studies have shown that institutional investors holding company stocks will significantly improve corporate governance,which in turn affects the quality of accounting information.So the main content of this article is whether the behavior of institutional investors will have an impact on analyst forecasts.Combined with China's special system model,it further explores the nature of property rights and the role of marketization.Based on principal-agent,revenue-cost theory and efficient market theory,this paper studies the impact of institutional investors' shareholding on the quality of securities analysts' earnings forecasts.All the A-share listed companies in 2011-2017 were selected as research samples.Based on the previous studies,the control variables were selected to determine the definition of variables,and the regression model of this paper was established.The conclusions of the study mainly include the following aspects.First,the institutional investor's shareholding will have a positive impact on the analyst's forecast quality.The higher the shareholding ratio,the smaller the error between the analyst's earnings forecast and the real forecast data.Secondly,compared with state-owned enterprises,institutional investors aremore inclined to speak in the daily decision-making of non-state-owned enterprises,because non-state-owned enterprises have less interference with non-state-owned enterprises,and nonstate-owned enterprise institutional investors hold stocks to analyze securities.The impact of the quality of the division's earnings forecast is even more pronounced.Finally,compared with the less market-oriented regions,the high-market regional legal system tends to be perfect,the investor protection mechanism is more comprehensive,and legal protection is provided for investor supervision.Therefore,in areas with high marketization,The impact of institutional investors on analysts' earnings quality is even more pronounced.The research in this paper enriches the economic impact of institutional investors' shareholdings,which provides good empirical evidence for China's growing institutional investors in the future.At the same time,taking into account the impact of different property rights and marketization on its role,it will guide institutional investors to develop in a better direction,enriching relevant literature on institutional investors' stock holdings and securities analysts' forecasts.