Effects of managerial overconfidence on analyst recommendations

Mei Chen Lin, Po Hsin Ho, Hsiang Lin Chih

Research output: Contribution to journalArticlepeer-review

5 Scopus citations


This study investigates the relation between managerial overconfidence and analyst recommendations. The empirical finding shows that analysts are less likely to issue upgrade recommendations for firms managed by overconfident CEOs. Similarly, analysts spend a longer time to upgrade stocks associated with overconfident CEOs. The effect of CEO overconfidence on recommendation revisions is non-monotonic. Analysts are more reluctant to upgrade firms with highly-overconfident CEOs. More experienced analysts are less susceptible to managerial overconfidence. Moreover, investors exhibit stronger response to recommendations for firms with overconfident CEOs.

Original languageEnglish
Pages (from-to)73-99
Number of pages27
JournalReview of Quantitative Finance and Accounting
Issue number1
StatePublished - 15 Jul 2019


  • Analyst experience
  • Analyst recommendation
  • Managerial overconfidence


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