S&P 500 Index Additions And Earnings Expectations  

Oleh:

Denis, Diane K. ; McConnell, John J. ; Ovtchinnikov, Alexei ; Yun, Yu

Jenis: Article from Journal - ilmiah internasional
Dalam koleksi: The Journal of Finance (EBSCO) vol. 58 no. 5 (Oct. 2003), page 1821-1840.
Topik: earning; indexes; stock prices; earnings forecasting; corporate profits; studies
Fulltext: p 1821.pdf (159.12KB)

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Perpustakaan Pusat (Semanggi) Nomor Panggil: JJ88 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada

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Isi artikel

Stock price increases associated with addition to the S & P 500 Index have been interpreted as evidence that demand curves for stocks slope downward. A key premise underlying this interpretation is that Index inclusion provides no new information about companies' future prospects. We examine this premise by analyzing analysts' earnings per share (eps) forecasts around Index inclusion and by comparing postinclusion realized earnings to preinclusion forecasts. Relative to benchmark companies, companies added newly to the Index experience significant increases in eps forecasts and significant improvements in realized earnings. These results indicate that S & P Index inclusion is not an information - free event.

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