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Age of Firms and the Value of Analyst Recommendation

Author

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  • Hassanudin Mohd Thas Thaker

    () (Department of Economics and Finance, Sunway University, Malaysia Author-2-Name: Azhar Mohamad Author-2-Workplace-Name: Kulliyyah of Economics and Management Sciences, International Islamic University Malaysia (IIUM) Author-3-Name: Author-3-Workplace-Name: Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:)

Abstract

Objective - This paper assesses the value of information disclosure in Malaysian analyst reports by examining three categories of firms, according to their age (young, medium and old). Methodology/Technique - The study uses a market-adjusted method to calculate the cumulative abnormal return and panel regression to test the research objective. The results from the unbalanced panel data reveals that not all information contained in the analyst reports is able to detect the movement in stock returns. Finding - Younger firms recorded two significant results (ROE and SPR) whereas among medium aged firms, TP, CFP, SPR, and MC all had an impact on CAR. The older firms showed that TP, EF, ROE and SPKLCI had an impact on CAR. Novelty – This qualitative inquiry reveals that Malaysian analyst reports tend to disclose information based on simple statistical analyses to formulate recommendations whilst ignoring other significant qualitative information.

Suggested Citation

  • Hassanudin Mohd Thas Thaker, 2019. "Age of Firms and the Value of Analyst Recommendation," GATR Journals jber174, Global Academy of Training and Research (GATR) Enterprise.
  • Handle: RePEc:gtr:gatrjs:jber174
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    More about this item

    Keywords

    Age; Value; Analyst Report; Malaysia.;

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G39 - Financial Economics - - Corporate Finance and Governance - - - Other

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