Cookies?
Library Header Image
LSE Research Online LSE Library Services

How analysts process information: technical and financial disclosures in the microprocessor industry

Beccalli, Elena, Miller, Peter and O'Leary, Ted (2015) How analysts process information: technical and financial disclosures in the microprocessor industry. European Accounting Review, 24 (3). pp. 519-549. ISSN 0963-8180

[img]
Preview
PDF - Accepted Version
Download (661kB) | Preview

Identification Number: 10.1080/09638180.2014.969526

Abstract

Following Bradshaw (‘Analyst information processing, financial regulation, and academic research’ [2009], and Analysts' forecasts: What do we know after decades of work? [2011]), this paper examines how analysts process information, particularly in an information environment characterised by multiple and potentially complementary information sources. The setting is the microprocessor industry, one in which technical information is particularly significant and complex to digest. Based on 3837 analyst earnings-forecast revisions, issued by 134 analysts, we examine quantitatively the speed, magnitude, and information content of the reactions of individual analysts and subgroups of analysts to both periodic and timely technical disclosures, and as a complement to periodic financial disclosure. We find that analysts are much slower to react to timely technical disclosures than they are to periodic financial disclosures. We find also that technical and financial disclosures complement each other. Furthermore, we find that there is a ‘hierarchy’ of analysts in this particular industry, as evidenced through the strength of reaction to timely technical disclosures. Finally, we find that lower speed in reacting to timely technical disclosures and a higher intensity in the use of timely technical disclosure (in conjunction with periodic financial disclosure) result in greater accuracy, and that more experienced analysts tend to be less accurate. We suggest that the findings may have implications for other industries such as Bio-Tech Pharma.

Item Type: Article
Official URL: http://www.tandfonline.com/loi/rear20
Additional Information: © 2014 European Accounting Association
Divisions: Accounting
Centre for Analysis of Risk & Regulation
LSE Health
Subjects: H Social Sciences > HG Finance
Sets: Departments > Accounting
Research centres and groups > Centre for Analysis of Risk and Regulation (CARR)
Research centres and groups > LSE Health
Date Deposited: 06 Nov 2014 09:24
Last Modified: 20 Mar 2019 02:37
URI: http://eprints.lse.ac.uk/id/eprint/60072

Actions (login required)

View Item View Item

Downloads

Downloads per month over past year

View more statistics