Recent studies have shown that the congruence (i.e. value relevance) of accounting earnings-based measures of performance (e.g., earnings, residual income) has been declining significantly over an extended period of time. We confirm this prior finding, and examine the implications of poor...

This paper investigates whether analysts' optimism affects the stock crash risk. Analysts' optimism can increase stock crash risk either by inducing overvaluation or by providing managers an opportunity to withhold bad news. Using analysts' forecast error as a proxy for analysts' optimism, we...