Aurora Borealis
1 July 1994 Financial Analysts Journal Volume 50, Issue 4

Consensus Expectations and International Equity Returns

  1. Anthony Bercel
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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Publisher Information
Association for Investment Management and Research 5 pages doi.org/10.2469/faj.v50.n4.76 ISSN/ISBN: 0015-198X

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