Panic herding: analysts' Covid-19 experiences and the interpretation of earnings news

Loading...
Thumbnail Image
Journal Title
Journal ISSN
Volume Title
School of Business | D4 Julkaistu kehittämis- tai tutkimusraportti tai -selvitys
Date
2020
Department
Rahoituksen laitos
Department of Finance
Major/Subject
Mcode
Degree programme
Language
en
Pages
65
Series
Aalto University publication series BUSINESS + ECONOMY, 4/2020
Abstract
This paper examines how local experiences of the Covid-19 pandemic affect sell-side analysts’ processing of earnings news. Exploiting variation in the intensity and timing of local outbreaks, I show that analysts who are more exposed to the virus tend to herd more closely with the consensus forecast. However, I find no evidence of increases in forecast pessimism. The data are consistent with the intensity of exposure to pandemic having a first order effect on analysts’ risk attitudes, rather than on the bias of their stated expectations.
Description
Keywords
analysts, Covid-19, earnings news, forecast boldness, risk attitudes
Other note
Citation