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Do analysts distribute negative opinions earlier?

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  • Yang, Yanhua Sunny
  • Yung, Chris

Abstract

We examine analysts’ forecast timing when issuing negative opinions. When management withholds bad news, good news become more abundant but relatively uninformative. We theoretically predict and empirically document that analysts treat observed bad news as having higher precision and respond to it by issuing forecasts more quickly and accurately than for good news forecasts. These results hold to various robustness checks. This study improves our understanding of negative information dissemination in capital markets.

Suggested Citation

  • Yang, Yanhua Sunny & Yung, Chris, 2024. "Do analysts distribute negative opinions earlier?," Journal of Financial Markets, Elsevier, vol. 67(C).
    • Handle: RePEc:eee:finmar:v:67:y:2024:i:c:s138641812300054x
    DOI: 10.1016/j.finmar.2023.100856
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    More about this item

    Keywords

    Financial analysts; Negative opinions; Forecast timing; Forecast accuracy;
    All these keywords.

    JEL classification:

    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • G20 - Financial Economics - - Financial Institutions and Services - - - General

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