{"title":"Panic herding: Analysts' COVID-19 experiences and the interpretation of earnings news","authors":"Matteo Vacca","doi":"10.1016/j.jeconbus.2024.106206","DOIUrl":null,"url":null,"abstract":"<div><div>This paper examines how local experiences of the COVID-19 pandemic affect sell- side analysts’ interpretation of earnings news. By exploiting the variation in the intensity and timing of local outbreaks, I show that analysts who are more exposed to the virus tend to herd more closely with the consensus forecast. However, I find no evidence of increases in forecast pessimism. The data are consistent with the intensity of exposure to the pandemic having a first-order effect on analysts’ risk attitudes, rather than on the bias of their stated expectations.</div></div>","PeriodicalId":47522,"journal":{"name":"JOURNAL OF ECONOMICS AND BUSINESS","volume":"132 ","pages":"Article 106206"},"PeriodicalIF":3.3000,"publicationDate":"2024-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"JOURNAL OF ECONOMICS AND BUSINESS","FirstCategoryId":"1085","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S0148619524000481","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS, FINANCE","Score":null,"Total":0}
引用次数: 0
Abstract
This paper examines how local experiences of the COVID-19 pandemic affect sell- side analysts’ interpretation of earnings news. By exploiting the variation in the intensity and timing of local outbreaks, I show that analysts who are more exposed to the virus tend to herd more closely with the consensus forecast. However, I find no evidence of increases in forecast pessimism. The data are consistent with the intensity of exposure to the pandemic having a first-order effect on analysts’ risk attitudes, rather than on the bias of their stated expectations.
期刊介绍：
Journal of Economics and Business: Studies in Corporate and Financial Behavior. The Journal publishes high quality research papers in all fields of finance and in closely related fields of economics. The Journal is interested in both theoretical and applied research with an emphasis on topics in corporate finance, financial markets and institutions, and investments. Research in real estate, insurance, monetary theory and policy, and industrial organization is also welcomed. Papers that deal with the relation between the financial structure of firms and the industrial structure of the product market are especially encouraged.
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