Analysts’ Choice of Peer Companies

Who is Talking about Whom? Determinants and Consequences.

“…This approach of forming a control group is used in other peer selection research (e.g., De Franco et al, 2015;Gong et al, 2011 The vector of variables , , contains several variables. First, I…”

“…For example, managers observe peers to shape their financial and strategic decisions (e.g., Badertscher, Shroff, & White, 2013;Francis, Hasan, Mani, & Ye, 2016;Leary & Roberts, 2014). Financial analysts, investment bankers, and equity investors employ peer valuation multiples to assist in their equity valuations of firms (e.g., Bhojraj & Lee, 2002;De Franco, Hope, & Larocque, 2015;Vismara, Signori, & Paleari, 2015). And boards of directors use peers to determine the amount of compensation to pay their executives (e.g., Faulkender & Yang, 2010;Gong, Li, & Shin, 2011).…”

“…/hobergphillips.tuck.dartmouth.edu/industryclass.htm.is 30 (i.e., if after the first restriction there are still more than 30 peer firms, then the 30 with the highest similarity scores are kept). This latter number is guided byDe Franco et al (2015) who find that the 99 th percentile of the number of peers…”

Comovement, financial reporting complexity, and information markets: Evidence from the effect of changes in 10-Q lengths on internet search volumes and peer correlations

“…There are many examples of low-priced signals that we could use for this analysis such as news releases issued by the firm, news and headlines from the popular press (Barber andOdean, 2008 andYuan, 2015), sector analyses, and sell-side analyst reports (De Franco et al, 2015;Muslu et al, 2014). However, the fact that these reports are being produced by the financial sector does not guarantee that they are being requested and used by investors.…”

Three Essays on Financial Statement Comparability

“…One of the main purposes of financial reporting standards is to increase the comparability of reported financial information. Using empirical measures of financial statement comparability, prior studies have confirmed that comparability plays an important role in analyst following De Franco, Hope, and Larocque 2015), audit fee (Zhang 2012), credit risk (Kim, Kraft, and Ryan 2013), acquisition decisions , stock price volatility (Kim, Li, Lu, and Yu 2016), the cost of debt (Fang, Li, Xin, and Zhang 2016), the cost of equity capital , and the informativeness of stock prices . The role of accounting comparability in one of the most important financing decisions firms face -trade credit -is, however, heretofore unexplored.…”