Seminar Date: 24 October, 2014 (Friday)

Seminar Time: 10:30 a.m. - 12:00 p.m.

Seminar Venue: Room 405, 4F, Building 1, College of Management

Speaker: Prof. Tony Chieh-tse Hou

Title: Analyst Forecast Revisions and Short-term Return Continuations in Canada Stocks

Abstract:

This paper examines the predictability of stock returns using analysts’ earnings forecast revisions information in Canada. We find stocks with greater number of upward forecast revision would earn significant higher future returns and the difference between upward and downward revisions could generate short-term return continuation patterns. The effect is positively related to book-to-market ratio, but negatively related to firm size and residual analyst coverage. Our result shed light on the importance of analysts’ earnings forecast information and support investors’ limited attention argument.