Analysts’ Recommendations as the Predictions of Future Stock Returns at Prague Stock Exchange

Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F61989100%3A27510%2F21%3A10258457" target="_blank" >RIV/61989100:27510/21:10258457 - isvavai.cz</a>
Result on the web
<a href="http://fgg-web.fgg.uni-lj.si/~/sdrobne/sor/SOR'21%20-%20Proceedings.pdf" target="_blank" >http://fgg-web.fgg.uni-lj.si/~/sdrobne/sor/SOR'21%20-%20Proceedings.pdf</a>
DOI - Digital Object Identifier
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Result language
angličtina
Original language name
Analysts’ Recommendations as the Predictions of Future Stock Returns at Prague Stock Exchange
Original language description
According to the efficient market hypothesis it is believed that all relevant information is already reflected in the stock market prices, which means that the future stock returns depend solely on the riskiness associated with the particular stock(s). On the other hand, it is a common practice that the analysts, usually brokerage firms or banks, publish their recommendations regarding the particular stocks and their future price development. In this paper, we study the recommendations issued on the bluechip stocks traded at the Prague stock exchange and their predictive power for the one-year period following the issuance of the recommendation. Based on the linear regression model we found that for more than two-thirds of analysts there is a statistically significant linear relationship between the one-year potential return and observed one-year return. However, we found the same relationship only for three stocks from eight analyzed stocks.
Czech name
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Czech description
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Publication year
2021
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Article name in the collection
SOR '21 proceedings : the 16th International Symposium on Operational Research in Slovenia : September 22-24, 2021 : online
ISBN
978-961-6165-57-0
ISSN
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e-ISSN
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Number of pages
6
Pages from-to
513-518
Publisher name
Slovenian Society Informatika
Place of publication
Ljubljana
Event location
Lublaň
Event date
Sep 22, 2021
Type of event by nationality
EUR - Evropská akce
UT code for WoS article
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