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Analyst coverage: Does the listing location really matter?

Author

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  • Hassan, Omaima A.G.
  • Skinner, Frank S.

Abstract

Using a count panel regression method, we find that the listing location really does matter as stocks listed on the main board (FTSE350) rather than the junior market (AIM) attract more analyst coverage than can be explained by existing factors, even when we control for listing requirements and the type of cross-listing. We also find that listing requirements have a significantly greater impact on the number of analysts following AIM companies rather than their FTSE350 counterparts. Moreover, pooling stocks from different listing locations can conceal additional differences in the determinates of analyst services for the main board and junior markets. For example, cross-listing on a stock exchange increases analysts coverage for FTSE350 stocks but not AIM stocks and listing on less transparent trading venues such as over the counter and alternative trading systems (dark pools) decreases analyst coverage, especially for AIM stocks.

Suggested Citation

  • Hassan, Omaima A.G. & Skinner, Frank S., 2016. "Analyst coverage: Does the listing location really matter?," International Review of Financial Analysis, Elsevier, vol. 46(C), pages 227-236.
    • Handle: RePEc:eee:finana:v:46:y:2016:i:c:p:227-236
    DOI: 10.1016/j.irfa.2016.05.008
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    References listed on IDEAS

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    Cited by:

    1. Mohammad Issa Almaharmeh & Hamzah Al-Mawali & Ghassan Obeidat, 2018. "Mandatory IFRS Adoption and Analyst Coverage: Evidence from the UK," Modern Applied Science, Canadian Center of Science and Education, vol. 12(11), pages 435-435, November.
    2. Galanti, Sébastien & Leroy, Aurélien & Vaubourg, Anne-Gaël, 2022. "Investment and access to external finance in Europe: Does analyst coverage matter?," International Review of Financial Analysis, Elsevier, vol. 81(C).
    3. Omaima A.G. Hassan, 2018. "The impact of voluntary environmental disclosure on firm value: Does organizational visibility play a mediation role?," Business Strategy and the Environment, Wiley Blackwell, vol. 27(8), pages 1569-1582, December.
    4. Galanti, Sébastien & Leroy, Aurélien & Vaubourg, Anne-Gaël, 2022. "Investment and access to external finance in Europe: Does analyst coverage matter?," International Review of Financial Analysis, Elsevier, vol. 81(C).
    5. Arjoon, Vaalmikki & Bhatnagar, Chandra Shekhar & Ramlakhan, Prakash, 2020. "Herding in the Singapore stock Exchange," Journal of Economics and Business, Elsevier, vol. 109(C).

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    More about this item

    Keywords

    Analyst coverage; Analysts following; Security analyst; FTSE350; AIM; Alternative trading systems;
    All these keywords.

    JEL classification:

    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • M4 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • M49 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Other

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