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Determinants of Management Earnings Forecasts: The Case of Global Shipping IPOs

Lookup NU author(s): Professor Dimitrios Gounopoulos

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Abstract

© 2017 John Wiley & Sons, Ltd. Firms that go public on global stock markets are not obliged to disclose earnings forecasts in their prospectuses. We use this fact to examine the shipping industry, where most firms voluntarily issue earnings forecasts during the IPO process, thus providing unique, international-level evidence. We find overall pessimistic forecasts of ship owners, primarily because of the industry's uncertain and volatile environment. High ship owner participation after going public is associated with less accurate earnings forecasts. Our results further indicate that financial leverage, a listing in an emerging stock market, and global market conditions are other main factors responsible for inaccurate earnings forecasts.

Publication metadata

Author(s): Drobetz W, Gounopoulos D, Merika A, Merikas A

Publication type: Article

Publication status: Published

Journal: European Financial Management

Year: 2017

Volume: 23

Issue: 5

Pages: 975-1015

Print publication date: 01/11/2017

Online publication date: 18/05/2017

Acceptance date: 02/04/2016

Date deposited: 15/12/2017

ISSN (print): 1354-7798

ISSN (electronic): 1468-036X

Publisher: Blackwell Publishing Ltd

URL: https://doi.org/10.1111/eufm.12121

DOI: 10.1111/eufm.12121

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