The role of the business press in the pricing of analysts’ recommendation revisions

  • Minkwan Ahn
  • Michael DrakeEmail author
  • Hangsoo Kyung
  • Han Stice


We investigate the information-dissemination role of the business press by examining the coverage of analyst recommendation revisions. Consistent with the press providing wider dissemination of analyst reports, we find evidence that coverage of analyst recommendation revisions significantly increases the initial market reaction to these revisions and decreases the subsequent price drift. Furthermore, we find that news flash coverage, rather than in-depth coverage, of a recommendation revision drives both the initial market reaction results and drift results. Finally, we show that broader press coverage influences the activities of large-trade institutional investors but not high-frequency traders. Overall, our findings suggest a complementary role between analysts and the business press: increased dissemination of recommendation revisions, rather than information creation on the part of the business press, serves to better inform the market about analyst recommendation revision decisions.


Analyst recommendations Business press Market reactions 

JEL Codes

M41 L82 G14 



We thank Artur Hugon, Derrald Stice, Jake Thornock, Brady Twedt, Andrew Van Buskirk, Roger White, and workshop participants at Arizona State University. All mistakes are our own.


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© Springer Science+Business Media, LLC, part of Springer Nature 2019

Authors and Affiliations

  1. 1.The University of Hong KongHong KongPeople’s Republic of China
  2. 2.Brigham Young UniversityProvoUSA
  3. 3.The Chinese University of Hong KongHong KongPeople’s Republic of China

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