We provide new evidence on individual analysts' differential abilities to forecast firm value. In matched sample analyses, we find that independent analysts' target prices perform well in predicting future price relative to investment-bank analysts. Our evidence suggests that independent...

In this article I discuss Penman (2016), titled “Valuation: Accounting for Risk and the Expected Return.” Penman (2016) is important because it offers potential insights that can help us understand why the book-to-market ratio and other accounting-based variables may impact expected stock...

This study finds that the association between future stock returns and information quality depends on how option-like is the firm's equity. Firms that have more growth options are more option-like. The association between future stock returns and information quality is negative (positive) for...

We provide the first large-scale study of the performance of expected-return proxies (ERPs) internationally. Analyst-forecast-based ICCs are sparsely populated and not robustly associated with future returns. Earnings-model-forecast-based ICCs are well-populated, but are unreliable outside the...