دانلود رایگان مقاله انگلیسی تاثیر حساسیت اقتصادی بر فعالیت تحقیقاتی تحلیلگران - Sage 2017

Abstract

In this article, we examine how economy-wide sentiment, measured with the University of Michigan’s Consumer Sentiment Index, affects analysts’ research activities. Using a firm-fixed effects design, we find that consumer sentiment, especially the component related to economic fundamentals, is negatively associated with analysts’ frequency of issuing research reports, but is positively associated with the precision of analysts’ idiosyncratic information, our proxy for analysts’ engagement in private information discovery. The evidence is more pronounced for firms with larger total assets, higher return on assets, better market performance, lower stock return volatility, and higher institutional ownership. We further document that analyst reports are more informative when consumer sentiment is higher. Taken together, our findings suggest that analysts respond to higher consumer sentiment by allocating more effort to private information discovery, which enhances the informativeness of their reports to investors. Our research reveals the impact of sentiment, a macrolevel factor, on analysts’ research activities, and it enriches the knowledge of analysts’ decision processes.

Conclusion

In this study, we explore the impact of consumer sentiment on analyst research activities, namely analysts’ frequency of issuing research reports and their effort allocated to private information discovery. Using a firm-fixed effect design, we document that analysts issue fewer earnings forecasts but engage in more extensive private information discovery during high sentiment periods, and that the results are primarily driven by the fundamental component of consumer sentiment. Further analyses suggest that investors perceive analyst reports as more informative during high sentiment periods; therefore, investors appear to value analysts’ increased efforts in acquiring and producing private information. Taken together, our results suggest that consumer sentiment plays a significant role in shaping analyst activities. More specifically, in response to high consumer sentiment, analysts appear to shift more effort toward private information discovery.

Our article enriches the literature on equity analysts by demonstrating how analysts collectively respond to consumer sentiment, an important macrolevel factor. Future studies can further explore the relations between analyst-specific characteristics (such as experience and industry expertise) and individual analysts’ responses to sentiment. Our findings also shed light on analysts’ effort allocation across different research activities. Future research can further explore the mechanism behind this effort allocation for a better understanding of equity analysts’ decision process.