1 July 1994Financial Analysts JournalVolume 50, Issue 4
Consensus Expectations and International Equity Returns
Numerous studies of U.S. markets have shown that stock selection models have been able to isolate securities that earn returns above those predicted by a simple market model. Models examining the relation between analyst expectations and returns have been particularly useful. Unexpected earnings, changes in analysts' earnings-per-share forecasts, the number of analysts revising their forecasts--all these measures have been found to be useful in predicting abnormal returns in U.S. equity markets. At least two of these measures--changes in analysts' EPS forecasts and the number of analysts changing their forecasts--are also related to abnormal returns in several international markets.
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Financial Analysts Journal
CFA Institute Member ContentPublisher Information
Association for Investment Management and Research
5 pages doi.org/10.2469/faj.v50.n4.76ISSN/ISBN: 0015-198X
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