Analyst Revenue Forecasts and Firm Revenue Misstatements
Ting Chiao Huang et al.
Earnings and revenue are ranked as the two most important performance measures reported to outsiders. However, prior literature primarily focuses on management’s incentives and willingness to manipulate earnings to meet earnings benchmarks. Increasingly, analysts are releasing forecasts of financial items in addition to aggregate earnings, with revenue forecasts being the most common. We posit that management may be under similar pressure to meet revenue forecasts given their impact on firm valu