Do analysts' earnings forecasts incorporate information in prior stock price changes?

This research examines whether analysts' earnings forecasts incorporate information in price changes. Even if the forecasts do not explicitly depend upon price changes,there should nevertheless be a positive association between analysts' forecast revisions and prior price changes. Moreover, if analysts incorporate only their private information in formulating a forecast and ignore price changes, then the likelihood that their estimate is less than (greater than) the realization increases following price increases (decreases). Empirical results are consistent with these conjectures and indicate that analysts' forecasts do not fully reflect the information in prior price changes.Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/29294/1/0000355.pd

Bank Privatization in Post-Communist Russia: The Case of Zhilsotsbank

http://deepblue.lib.umich.edu/bitstream/2027.42/39397/3/wp5.pd

Early Surgical Morbidity and Mortality in Adults with Congenital Heart Disease: The University of Michigan Experience

Objectives.  To review early surgical outcomes in a contemporary series of adults with congenital heart disease (CHD) undergoing cardiac operations at the University of Michigan, and to investigate possible preoperative and intraoperative risk factors for morbidity and mortality. Methods.  A retrospective medical record review was performed for all patients ≥18 years of age who underwent open heart operations by a pediatric cardiothoracic surgeon at the University of Michigan Congenital Heart Center between January 1, 1998 and December 31, 2004. Records from a cohort of pediatric patients ages 1–17 years were matched to a subset of the adult patients by surgical procedure and date of operation. Results.  In total, 243 cardiac surgical operations were performed in 234 adult patients with CHD. Overall mortality was 4.7% (11/234). The incidence of major postoperative complications was 10% (23/234) with a 19% (45/23) minor complication rate. The most common postoperative complication was atrial arrhythmias in 10.8% (25/234). The presence of preoperative lung or liver disease, prolonged cardiopulmonary bypass and aortic cross clamp times, and postoperative elevated inotropic score and serum lactates were significant predictors of mortality in adults. There was no difference between the adult and pediatric cohorts in terms of mortality and morbidity. Conclusions.  The postoperative course in adults following surgery for CHD is generally uncomplicated and early survival should be expected. Certain risk factors for increased mortality in this patient population may include preoperative presence of chronic lung or liver dysfunction, prolonged cardiopulmonary bypass and aortic cross-clamp times, and postoperative elevated inotropic score and serum lactate levels.Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/75596/1/j.1747-0803.2008.00170.x.pd

Foreign-language effects in cross-cultural behavioral research: Evidence from the Tanzanian Hadza

Behavioral research in traditional subsistence populations is often conducted in a non-native language. Recent studies show that non-native language-use systematically influences behavior, including in widely used methodologies. However, such studies are largely conducted in rich, industrialized societies, using at least one European language. This study expands sample diversity. We presented four standard tasks—a “dictator” game, two sacrificial dilemmas, a wager task, and five Likert-risk tolerance measures—to 129 Hadza participants. We randomly varied study languages—Hadzane and Kiswahili—between participants. We report a moderate impact of study language on wager decisions, alongside a substantial effect on dilemma decisions and responses to Likert-assessments of risk. As expected, non-native languages fostered utilitarian choices in sacrificial dilemmas. Unlike previous studies, non-native-language-use decreased risk preference in wager and Likert-tasks. We consider alternative explanatory mechanisms to account for this reversal, including linguistic relativity and cultural context. Given the strength of the effects reported here, we recommend, where possible, that future cross-cultural research should be conducted in participants’ first language

Databases for Congenital Heart Defect Public Health Studies Across the Lifespan

Peer Reviewedhttps://deepblue.lib.umich.edu/bitstream/2027.42/139106/1/jah31841_am.pdfhttps://deepblue.lib.umich.edu/bitstream/2027.42/139106/2/jah31841.pd

The ability of analysts’ recommendations to predict optimistic and pessimistic forecasts

Previous researches show that buy (growth) companies conduct income increasing earnings management in order to meet forecasts and generate positive forecast Errors (FEs). This behavior however, is not inherent in sell (non-growth) companies. Using the aforementioned background, this research hypothesizes that since sell companies are pressured to avoid income increasing earnings management, they are capable, and in fact more inclined, to pursue income decreasing Forecast Management (FM) with the purpose of generating positive FEs. Using a sample of 6553 firm-years of companies that are listed in the NYSE between the years 2005–2010, the study determines that sell companies conduct income decreasing FM to generate positive FEs. However, the frequency of positive FEs of sell companies does not exceed that of buy companies. Using the efficiency perspective, the study suggests that even though buy and sell companies have immense motivation in avoiding negative FEs, they exploit different but efficient strategies, respectively, in order to meet forecasts. Furthermore, the findings illuminated the complexities behind informative and opportunistic forecasts that falls under the efficiency versus opportunistic theories in literature

Street Earnings Activation Delay

Street earnings are non-GAAP earnings, adjusted for consistency with the analyst majority basis and disseminated by forecast data providers (FDPs). We find that the time it takes an FDP to incorporate street earnings in its products (activation delay, hereafter) reflects variation in the difficulty of constructing street earnings, investor demand for timely street earnings, and FDPs' limited attention and resources. Furthermore, the market reaction to reported earnings is more timely when activation delay is shorter, and price discovery is highly concentrated during the hour after street earnings are activated. Finally, activation delay increases the delay with which street earnings are incorporated in analyst forecasts. We conclude that frictions in information processing prevent market participants from instantaneously constructing and incorporating street earnings in their decisions, and that FDPs play a key role in alleviating these frictions