Equity Analyst Reports and Stock Prices
In this paper we carry out cointegration analyses, in order to study whether the relationship between analysts’ recommendations and their projected capital gains (or losses), is consistent with the hypothesis that sell recommendations are costlier than buy recommendations. We find that recommendatio...
| Main Authors: | , |
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| Format: | Online |
| Language: | eng |
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Universidad Pedagógica y Tecnológica de Colombia
2022
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| Online Access: | https://revistas.uptc.edu.co/index.php/cenes/article/view/12638 |
| _version_ | 1801705966594424832 |
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| author | Astaiza Gómez, José Gabriel Perez Pacheco, Camilo Andrés |
| author_facet | Astaiza Gómez, José Gabriel Perez Pacheco, Camilo Andrés |
| author_sort | Astaiza Gómez, José Gabriel |
| collection | OJS |
| description | In this paper we carry out cointegration analyses, in order to study whether the relationship between analysts’ recommendations and their projected capital gains (or losses), is consistent with the hypothesis that sell recommendations are costlier than buy recommendations. We find that recommendations that plainly urge the investor to take action (buy, sell) are consistent with their estimated losses. We also find that recommendations react mildly to higher projected losses, and strongly to higher projected capital gains, which is consistent with systematic optimism. Additionally, we could establish that higher projected losses are positively related to dispersion in recommendations. In summary, we got evidence consistent with Womack’s (1996) hypothesis that the cost of issuing a sell recommendation is higher than the cost of a buy recommendation. |
| format | Online |
| id | oai:oai.revistas.uptc.edu.co:article-12638 |
| institution | Revista Apuntes del Cenes |
| language | eng |
| publishDate | 2022 |
| publisher | Universidad Pedagógica y Tecnológica de Colombia |
| record_format | ojs |
| spelling | oai:oai.revistas.uptc.edu.co:article-126382023-08-23T22:56:37Z Equity Analyst Reports and Stock Prices Informes de renta variable y los precios de las acciones Astaiza Gómez, José Gabriel Perez Pacheco, Camilo Andrés sell-side analysts intrinsic value trading incentives informational value access to information analistas sell-side valor intrínseco incentivos de trading valor informacional acceso a la información In this paper we carry out cointegration analyses, in order to study whether the relationship between analysts’ recommendations and their projected capital gains (or losses), is consistent with the hypothesis that sell recommendations are costlier than buy recommendations. We find that recommendations that plainly urge the investor to take action (buy, sell) are consistent with their estimated losses. We also find that recommendations react mildly to higher projected losses, and strongly to higher projected capital gains, which is consistent with systematic optimism. Additionally, we could establish that higher projected losses are positively related to dispersion in recommendations. In summary, we got evidence consistent with Womack’s (1996) hypothesis that the cost of issuing a sell recommendation is higher than the cost of a buy recommendation. En este trabajo realizamos análisis de cointegración, con el fin de estudiar si la relación entre las recomendaciones de los analistas y sus ganancias (o pérdidas) de capital proyectadas es consistente con la hipótesis de que las recomendaciones de venta son más costosas que las recomendaciones de compra. Encontramos que las recomendaciones que claramente instan al inversionista a tomar medidas (comprar, vender) son consistentes con sus pérdidas estimadas. También encontramos que las recomendaciones reaccionan levemente a mayores pérdidas proyectadas y fuertemente a mayores ganancias de capital proyectadas, lo cual es consistente con optimismo sistemático. Además, hallamos que pérdidas proyectadas más altas están relacionadas positivamente con la dispersión de recomendaciones. En resumen, notamos evidencia consistente con la hipótesis de Womack (1996) de que el costo de emitir una recomendación de venta es mayor que el costo de una recomendación de compra. Universidad Pedagógica y Tecnológica de Colombia 2022-02-22 info:eu-repo/semantics/article info:eu-repo/semantics/publishedVersion Peer reviewed Article application/pdf text/xml https://revistas.uptc.edu.co/index.php/cenes/article/view/12638 10.19053/01203053.v41.n73.2022.12638 Apuntes del Cenes; Vol. 41 No. 73 (2022); 43-62 Apuntes del Cenes; Vol. 41 Núm. 73 (2022); 43-62 2256-5779 0120-3053 eng https://revistas.uptc.edu.co/index.php/cenes/article/view/12638/11457 https://revistas.uptc.edu.co/index.php/cenes/article/view/12638/13356 Copyright (c) 2022 José Gabriel Astaiza Gómez, Camilo Andrés Perez Pacheco http://creativecommons.org/licenses/by-nc-sa/4.0 |
| spellingShingle | sell-side analysts intrinsic value trading incentives informational value access to information analistas sell-side valor intrínseco incentivos de trading valor informacional acceso a la información Astaiza Gómez, José Gabriel Perez Pacheco, Camilo Andrés Equity Analyst Reports and Stock Prices |
| title | Equity Analyst Reports and Stock Prices |
| title_alt | Informes de renta variable y los precios de las acciones |
| title_full | Equity Analyst Reports and Stock Prices |
| title_fullStr | Equity Analyst Reports and Stock Prices |
| title_full_unstemmed | Equity Analyst Reports and Stock Prices |
| title_short | Equity Analyst Reports and Stock Prices |
| title_sort | equity analyst reports and stock prices |
| topic | sell-side analysts intrinsic value trading incentives informational value access to information analistas sell-side valor intrínseco incentivos de trading valor informacional acceso a la información |
| topic_facet | sell-side analysts intrinsic value trading incentives informational value access to information analistas sell-side valor intrínseco incentivos de trading valor informacional acceso a la información |
| url | https://revistas.uptc.edu.co/index.php/cenes/article/view/12638 |
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