Abstract
The aim of this chapter is to examine the impact of a firms’ intangible intensity on analyst forecast accuracy, using data drawn from a sample of 87 Spanish industrial firms over the period 2000–2016. Our results show that higher intangible intensity is associated with lower analyst forecast accuracy. This result holds after taking into account additional firm-level characteristics that define the set of hard-to-value and difficult-to-arbitrage firms (HVDA), the effects of both the global financial crisis and sovereign debt crisis in the Spanish economy, and variables affecting the degree of information asymmetries among the firm’s main stakeholders.
Rafael Santamaría (In memoriam)
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Notes
- 1.
Goodwill, brand recognition and intellectual property, such as patents, trademarks and copyrights, are examples of intangible assets in the balance sheet. Intangible activity could also be approached with the expenses the firm dedicates to its research and development activities.
- 2.
To check the robustness of our results, we run the analysis with different alternatives of forecast error measures. Scaling by the price of the previous year, or dealing with problems of small scalars are some of them. Our results remain invariant to these considerations.
- 3.
The results are available from the authors upon request.
- 4.
This absence of statistical significant maybe potentially explained by the simultaneous influence of other channels through which information asymmetries could be reduced. In particular, the effect of the analysts’ forecasts.
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Acknowledgements
The authors thank the anonymous referee for helpful comments and suggestions. Elena Ferrer and Rafael Santamaría are grateful for financial support from the Spanish Ministry of Economy and Competitiveness, Project ECO2016-77631-R. Nuria Suárez acknowledges financial support from the Spanish Ministry of Economy and Competitiveness, Project MINECO-16-ECO2016-79693-P, and from the Comunidad de Madrid, Project S2015/HUM-3353.
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Ferrer, E., Santamaría, R., Suárez, N. (2020). Does Intangible Intensity Affect Analyst Accuracy? Some Evidence from Spanish Firms. In: Díaz Díaz, B., Capaldi, N., Idowu, S.O., Schmidpeter, R. (eds) Responsible Business in a Changing World. CSR, Sustainability, Ethics & Governance. Springer, Cham. https://doi.org/10.1007/978-3-030-36970-5_13
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