Firm-specific or market-wide information : how does analyst coverage influence stock price synchronicity?

Yongsik Kim, Doojin Ryu

This study shows that analysts generate firm-specific information, rather than market-wide information. Whereas previous studies report only the positive relationship between stock price synchronicity and analyst coverage, we suggest that the positive relation can be attributed to the interaction between analyst coverage and firm performance cyclicality. After controlling for the interaction effect between the analyst coverage and cyclicality, synchronicity decreases with the analyst coverage. Both effects diminish with the high analyst forecast dispersion, namely, we observe the decreasing effect of increasing analyst coverage on synchronicity and the increasing effect of interaction between analyst coverage and cyclicality.

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Year of publication:	2022
Authors:	Kim, Yongsik ; Ryu, Doojin
Published in:	Borsa Istanbul Review. - Amsterdam [u.a.] : Elsevier, ISSN 2214-8450, ZDB-ID 2745445-9. - Vol. 22.2022, 6, p. 1069-1078
Subject:	Analyst coverage \| Cyclicality \| Firm performance \| Firm-specific information \| Stock price synchronicity \| Börsenkurs \| Share price \| Finanzanalyse \| Financial analysis \| Unternehmenserfolg

Type of publication:	Article
Type of publication (narrower categories):	Aufsatz in Zeitschrift ; Article in journal
Language:	English
Other identifiers:	10.1016/j.bir.2022.07.011 [DOI]
Classification:	G14 - Information and Market Efficiency; Event Studies ; G15 - International Financial Markets ; G19 - General Financial Markets. Other
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://ebvufind01.dmz1.zbw.eu/10014305747