Not all Analysts are Created Equal: Evidence from Seasoned Equity Offerings
When firms manage earnings, financial analysts must choose to include or exclude the managed component of earnings from their forecasts. Analysts are said to be informative if they exclude the managed component to forecast unmanaged (true) earnings. In contrast, they are said to be accurate if they...
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| Format: | Article ou chapitre numérique |
| Język: | Français |
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2025
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| Dostęp online: | Accès Université d'Orléans et IFPM Accès Université d'Orléans et IFPM |
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cairn-FINA_PR_045FINAFinance https://shs.cairn.info/journal-finance-2025-3-page-176?lang=en https://doi.org/10.3917/fina.pr.045 Not all Analysts are Created Equal: Evidence from Seasoned Equity Offerings Kazmi, Hassan RazaDumontier, Pascal2025 analystes financiersaugmentation de capitalgestion des chiffres comptablesl’exactitudel’informativitéanalyst forecastearnings managementforecast accuracyinformativenessseasoned equity offeringsfre Finance | 46 | 3 | 2025-11-17 | p. 176-216 | 0752-6180 FINA_46346 When firms manage earnings, financial analysts must choose to include or exclude the managed component of earnings from their forecasts. Analysts are said to be informative if they exclude the managed component to forecast unmanaged (true) earnings. In contrast, they are said to be accurate if they include it to issue forecasts close to the reported earnings. Scant yet contradictory literature on the issue generalizes all analysts to be either accurate or informative. This study investigates analysts’ forecasts around Seasoned Equity Offerings (SEOs) when significant detrimental upwards earnings management is suspected. We posit that while some analysts strive to be accurate, others favour informativeness. Using individual forecasts around SEOs issued in Europe from 2000 to 2016, we find that while informativeness-seeking analysts decrease their post-SEO forecasts, accuracy-seeking ones leave them unchanged. We focus on the forecast downgrades and find that; the decrease is lesser for bigger firms that are less likely to manage earnings. This decrease is greater for firms more likely to manage earnings such as those with high discretionary accruals or those that issue a proportionally high value of equity. Our results contribute to the literature on analysts by segregating accurate and informative forecasts and identifying key characteristics impacting these forecasts. JEL Classification: G14; G17; G32; M41Cette étude examine le comportement des analystes financiers face à la gestion des chiffres comptables, en se concentrant sur les offres d'actions secondaires, où une gestion significative à la hausse des résultats financiers est souvent soupçonnée. Les analystes sont classés en deux groupes : ceux qui privilégient l'exactitude (en alignant leurs prévisions sur les résultats déclarés) et ceux qui favorisent l'informativité (en prévoyant les résultats non gérés ou reflétant la véritable performance de l’entreprise). En analysant 1 733 offres d’actions en Europe entre 2000 et 2016, l’étude révèle que les analystes informatifs révisent leurs prévisions à la baisse après l'annonce des offres, tandis que ceux recherchant l'exactitude maintiennent leurs prévisions inchangées. Les analystes informatifs ajustent davantage leurs prévisions pour les entreprises présentant une probabilité accrue de gestion des chiffres comptables, notamment celles avec des accruals discrétionnaires élevés ou des émissions de grande envergure. Les résultats soulignent l'influence des caractéristiques des entreprises et des prévisions sur ces comportements différenciés. Par exemple, les grandes entreprises et celles suivies par de nombreux analystes voient une réduction moins marquée des prévisions informatives, en raison d’une moindre probabilité de gestion des chiffres comptables. Par ailleurs, la directive européenne sur les abus de marché (MAD) a réduit les conflits d'intérêts parmi les analystes affiliés. Cette recherche enrichit la littérature en différenciant les approches des analystes face aux offres d’actions et en offrant une nouvelle perspective sur l’influence de l’informativité dans leurs prévisions, ouvrant ainsi la voie à une meilleure compréhension des comportements des analystes financiers.Cairn restricted access |
| language |
Français |
| format |
Article ou chapitre numérique |
| building |
0/Bibliothèque numérique/ 1/Bibliothèque numérique/Cairn/ |
| topic |
analystes financiers augmentation de capital gestion des chiffres comptables l’exactitude l’informativité analyst forecast earnings management forecast accuracy informativeness seasoned equity offerings |
| spellingShingle |
analystes financiers augmentation de capital gestion des chiffres comptables l’exactitude l’informativité analyst forecast earnings management forecast accuracy informativeness seasoned equity offerings Kazmi, Hassan Raza Dumontier, Pascal Not all Analysts are Created Equal: Evidence from Seasoned Equity Offerings |
| topic_facet |
analystes financiers augmentation de capital gestion des chiffres comptables l’exactitude l’informativité analyst forecast earnings management forecast accuracy informativeness seasoned equity offerings |
| description |
When firms manage earnings, financial analysts must choose to include or exclude the managed component of earnings from their forecasts. Analysts are said to be informative if they exclude the managed component to forecast unmanaged (true) earnings. In contrast, they are said to be accurate if they include it to issue forecasts close to the reported earnings. Scant yet contradictory literature on the issue generalizes all analysts to be either accurate or informative. This study investigates analysts’ forecasts around Seasoned Equity Offerings (SEOs) when significant detrimental upwards earnings management is suspected. We posit that while some analysts strive to be accurate, others favour informativeness. Using individual forecasts around SEOs issued in Europe from 2000 to 2016, we find that while informativeness-seeking analysts decrease their post-SEO forecasts, accuracy-seeking ones leave them unchanged. We focus on the forecast downgrades and find that; the decrease is lesser for bigger firms that are less likely to manage earnings. This decrease is greater for firms more likely to manage earnings such as those with high discretionary accruals or those that issue a proportionally high value of equity. Our results contribute to the literature on analysts by segregating accurate and informative forecasts and identifying key characteristics impacting these forecasts. JEL Classification: G14; G17; G32; M41 |
| author |
Kazmi, Hassan Raza Dumontier, Pascal |
| author_facet |
Kazmi, Hassan Raza Dumontier, Pascal |
| author_sort |
Kazmi, Hassan Raza |
| title |
Not all Analysts are Created Equal: Evidence from Seasoned Equity Offerings |
| title_short |
Not all Analysts are Created Equal: Evidence from Seasoned Equity Offerings |
| title_full |
Not all Analysts are Created Equal: Evidence from Seasoned Equity Offerings |
| title_fullStr |
Not all Analysts are Created Equal: Evidence from Seasoned Equity Offerings |
| title_full_unstemmed |
Not all Analysts are Created Equal: Evidence from Seasoned Equity Offerings |
| title_sort |
not all analysts are created equal: evidence from seasoned equity offerings |
| publishDate |
2025 |
| container_title |
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| container_issue |
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| url |
https://ezproxy.univ-orleans.fr/login?url=https://shs.cairn.info/journal-finance-2025-3-page-176?lang=en https://ezproxy.univ-orleans.fr/login?url=https://doi.org/10.3917/fina.pr.045 |
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1877245917115973632 |