This paper investigates the association between current dividends and analysts’ subsequent earnings forecast errors. This investigation is motivated by the evidence on analyst optimism and Ohlson (1991)’s fundamental valuation theory that dividends displace future permanent earnings. For the...

There is compelling empirical evidence to suggest that good news about corporate performance comes out early but bad news comes out late. Regardless of the underlying reason for such differential timing, existence of such systematic behavior leads to three related questions that we seek to...