Why Do EPS Forecast Error and Dispersion Not Vary with Scale? Implications for Analyst and Managerial Behavior

By Foong Soon Cheong, Jacob K. Thomas. 2011

128 citations recorded by the source corpus.

Subfields: Accounting, Finance

View Paper: https://www.semanticscholar.org/paper/2e2929aa645a1bc29c44ce819d5373c5e5db47d2

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In Accounting

1. Marsha B. Keune
2. Eric C. So
3. Karla M. Johnstone

In Finance

1. Marsha B. Keune
2. Eric C. So
3. Karla M. Johnstone

Citations in the corpus

• Materiality Judgments and the Resolution of Detected Misstatements: The Role of Managers, Auditors, and Audit Committees (2012, background): “Cheong and Thomas (2011) show that signed forecast error does not vary with scale and recommend that researchers consider using unscaled forecast error measures.”
• The debt market relevance of management earnings forecasts: evidence from before and during the credit crisis (2011, unknown): “13 We prefer to scale by absolute value of forecast errors rather than by stock price, since Cheong and Thomas (2010) find that forecast errors and seasonally differenced earnings per share do not vary with stock price. However, our results are robust to scaling by stock price, as well as to includi”
• Identifying Expectation Errors in Value/Glamour Strategies: A Fundamental Analysis Approach (2012, unknown): “…analyst forecast error and earnings announcement return evidence, the incongruent value/glamour strategy is also 15 We scale forecast errors and revisions by assets per share to develop measures of expectation errors that are not reliant on firms’ share price (Ball 2011;Cheong and Thomas 2011).”
• A New Approach to Predicting Analyst Forecast Errors: Do Investors Overweight Analyst Forecasts? (2013, background): “Journal of Financial Economics (2013), http earnings expectations created by analyst forecasts, the numerator and denominator of CO could move in tandem, which can potentially induce spurious cross-sectional variation (Ball, 2011; Cheong and Thomas, 2011).10 Having defined CO in Eq.”