Analyst Coverage around Mergers & Acquisitions
We examine how changes in analyst coverage and increased information uncertainty resulting from mergers and acquisitions (M&As) affect the research quality of merged firms. The cross-sectional variations in analyst turnovers are related to investment banks and analysts re-evaluating the benefits and costs in providing coverage. Among the analysts covering the merged firm, those who have covered the target before the M&A transaction are the most accurate in forecasting earnings for the merged firm. The accuracy of the consensus forecast of the merged firm also increases with the fraction of these target analysts. The positive impact of target analysts is especially marked in diversifying mergers. Our results suggest that, with knowledge of the target firm, target analysts can improve the research quality of the merged firm by alleviating information loss from the delisting of target firm.
Mergers and acquisitions analyst coverage investment bank forecast accuracy
Mengxing Zhao Julie L. Zhu
Finance Department University of Alberta Edmonton, AB T6G2R6 Accounting Division Columbia Business School New York, NY 10027
国际会议
广州
英文
1-50
2009-07-07（万方平台首次上网日期，不代表论文的发表时间）