Analyst Reputaiton And Earnings Forecast Accuracy

Securities analysts play the role of information intermediaries in the securities market.The quality of securities analysts determines the level of information efficiency in the securities market.An effective analyst reputation incentive mechanism is conducive to promoting analysts to provide high-quality information to institutional investors.The evaluation of securities analysts by institutional investors is a core component of the reputation incentive mechanism of securities analysts.The selection of securities analysts by third parties other than buyers and sellers has become the most important evaluation of securities analysts by institutional investors.At present,the selection of the largest and most recognized securities analysts in China is the "Best New Analyst of New Wealth" by the "New Fortune" magazine in 2003.This article selects the best analysts selected by New Fortune magazine from 2013 to 2017 as the research object,and studies the relationship between the accuracy of analyst earnings forecasts and analyst reputation.The research results show that,on the whole,the earnings forecast of award-winning analysts is not significantly better than that of non-winning analysts.After controlling the analyst's winning history,the analyst's earnings forecast before the first award is better than the never-winning analyst,but this result is not significant under the mean test Among the winning analysts,there is no significant difference in the accuracy of earnings forecasts of securities analysts in different rankings.In addition,through Fama-MacBeth regression,it is found that the accuracy of analysts' earnings forecasts has a significant negative correlation with their personal reputation.The higher the analyst's reputation,the worse the analyst's earnings forecasts are.When a non-winning analyst makes a profit forecast,the more the number of research reports of the listed company being predicted covers the more accurate the earnings forecast is.Regardless of the analyst's reputation,the time interval between the release date of the earnings forecast and the actual annual report has a positive correlation with the accuracy of the earnings forecast.The longer the interval between the date when the earnings forecast is published and the day when the actual annual report is published,the worse the accuracy of earnings forecasts.Regardless of the analyst's reputation,the larger the company,the smaller the error in its earnings forecasts.