The impact of executive inside debt on sell-side financial analyst forecast characteristics

Bhandari, Avishek; Mammadov, Babak; Thevenot, Maya

doi:10.1007/s11156-017-0671-8

Cited by 10 publications

(5 citation statements)

References 51 publications

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“…7 If there are multiple analysts making the EPS forecasts for a firm, we employ the average of their last available forecasts for annual EPS. In line with prior research on analyst forecast errors (Lang and Lundholm 1996;Das et al 1998;Lim 2001;Hong and Kubik 2003;Ke and Yu 2006;Dhaliwal et al 2012;Hao et al 2017;Bhandari et al 2018), we control for firm size (size), return volatility (retvol), stock price (price), abnormal stock returns (qtrret), pre-tax return on assets (roa), financial constraints (hp), institutional ownership (insti), intangible assets (intangible), book-to-market ratio (btm), analyst forecast horizon (horizon), abnormal trading volume (abtradvol), change in pre-tax return on assets (changeroa), and change in EPS (changeeps). These variables are defined in the Appendix.…”

Section: The Effect Of Corporate Tax Avoidance On Analyst Forecast Ersupporting

confidence: 84%

The impact of corporate tax avoidance on analyst coverage and forecasts

Ren

Taffler

2019

Rev Quant Finan Acc

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Corporate tax avoidance is likely to be associated with a high level of earnings management and with high financial opacity in the time-series. On this basis, we hypothesize that analyst coverage is negatively associated with corporate tax avoidance. Our results confirm this conjecture, and are robust to using a firm-fixed-effects model and a quasi-natural experiment to control for potential endogeneity. Additional analysis shows that analyst coverage is negatively related to tax risk, but there is no evidence that the informativeness of, or errors in, analyst forecasts are associated with tax avoidance. Overall, our study advances understanding of the implications of corporate tax avoidance for analyst behavior.

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Section: The Effect Of Corporate Tax Avoidance On Analyst Forecast Ersupporting

confidence: 84%

The impact of corporate tax avoidance on analyst coverage and forecasts

Ren

Taffler

2019

Rev Quant Finan Acc

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“…Other researchers found comparable results (Ananthataman & Lee, 2014;Cassell et al, 2012;Edmans & Liu, 2011). Also, inside debt is shown to influence manager behavior and even the information environment as measured by increased analyst forecast accuracy (Bhandari et al, 2018).…”

Section: Background Literature and Hypothesis Developmentmentioning

confidence: 99%

Defined benefit pension de‐risking and corporate risk‐taking

Silverstein

2021

Financial Management

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U.S. corporate sponsors of defined benefit (DB) pension plans in recent years have been de-risking by paying premiums to transfer their pension plan assets and liabilities to the balance sheets of third-party insurers. The passage of the Moving Ahead for Progress in the 21st Century Act (MAP-21) in 2012 provided the pension funding relief necessary to make de-risking a mainstream corporate activity. This study provides the first empirical analysis of plan and firm factors that cause a firm to de-risk its DB pension plans. We find a positive association between de-risking and aggregate corporate risk-taking. The results also show that de-risking, on average, has a stronger effect on corporate financing policy than investment policy, leading to an increase in credit risk reflected in a firm's credit rating and cost of debt. Also, we present suggestive evidence that the reallocation of pension risk increases firm idiosyncratic risk and excess returns.

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“…In line with the same argument, Bhandari & Kohlbeck ( 2018 ) find that CSR practices by firms are value relevant information to analysts and have implications to the firms’ performance. Analysts have been considered as the sophisticated investors who take wide range of value relevant information into consideration (Bhandari et al 2018 ). Combining all the above arguments from various studies, EVA seems to carry other incremental information such as CSR and managerial ethics than compared to traditional measures of firm performance.…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Economic Value Added (EVA) for Performance Evaluation of Public Organizations

Subedi

Farazmand

2020

Public Organiz Rev

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This study tests whether economic value added (EVA) as a performance evaluation metric incentivizes public administrators to increase the performance of public organizations. It utilizes data from Wind Info Database (WIND) and finds that the adoption of EVA as a performance evaluation metric incentivizes public administrators to increase the overall efficiency of the public organizations under study. The study suggests that public administrators make prudent investment and operating decisions after the adoption of EVA as their performance evaluation metric, thereby increasing the overall organizational performance. Using 2274 firm-year observations for the period from 2009 to 2010 in China, this paper uses first-difference change analysis methodology that takes care of firm-level unobservable heterogeneities and addresses endogeneity concerns, thereby producing robust results. The change analysis setting has been used in prior studies to find the effect of certain treatment (e.g., Lyons et al. 2001; Kerr et al. 2006; Pal and Pohit 2014). Lyons et al. (2001) argue that the change analysis focuses on studying differences before and after services (i.e., the presence and absence of treatment) that are received. In our research design, the treatment is adoption of EVA by the SASAC, which occurred in year 2010.

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The impact of executive inside debt on sell-side financial analyst forecast characteristics

Cited by 10 publications

References 51 publications

The impact of corporate tax avoidance on analyst coverage and forecasts

The impact of corporate tax avoidance on analyst coverage and forecasts

Defined benefit pension de‐risking and corporate risk‐taking

Economic Value Added (EVA) for Performance Evaluation of Public Organizations

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