Abstract:
Because in the theory of economics, the value of a company is based on the current
value of future cash flows and profit is used as a substitute for cash flows,
profit forecasting is of particular importance. In the research, the effect of rounding
and revision in predicting earnings per share on the investors' attention in Iran
has been investigated. After designing the investors' attention assessment indexes,
the transaction information was collected from the Stock Exchange in the fiveyear
period of 2011-2015. The statistical sample consists of 120 companies selected
by systematic elimination method and totally obtained 600 year-firm. In
this research, linear regression and correlation were used to investigate the hypotheses
of the research and Eviews software was used to analyze the data and test
the hypotheses. What can be said in the summing up and conclusion of the test of
research hypotheses is that predicting the earning per share influences investors
'attention, as well as the revision of the earnings per share influences the investors'
attention. On the other hand, research studies show that the rounding in interaction
with the revision in predicting earnings per share can also affect the investors'
attention.
Machine summary:
In the research, the effect of round- ing and revision in predicting earnings per share on the investors' attention in Iran has been investigated.
On the other hand, research studies show that the rounding in interaction with the revision in predicting earnings per share can also affect the investors'attention.
1 Methodology and Hypotheses According to theoretical foundations and in order to achieve the research objectives, the following hypotheses are presented: The main hypothesis: Rounding and revision in earnings forecasting per share affect the investors' attention.
With respect to estimated α and β at the previous stage, and regardless of the estimation error, and with the Rmt placement calculated in model (6), we predict E(Rit), the expected return: (View the image of this page) In order to test the research hypotheses, these abnormal returns should be calculated for periods of time around revision news in the forecast of earnings per share that this study has 3 days (1 day before and 1 day after the announcement of the review in the prediction of earnings per share).
On the other hand, research shows that rounding in interaction with the revision in earnings forecasting per share can also affect the attention of investors.
It is also recommended that investors and analysts make short-term and long-term investment decisions, along with the use of figures provided by companies and the capital market are factors such as rounding and revision in the same way, based on the results of the first sub-hypothesis, the change in the prediction of the profit forecast of each share contributes to a change in the expected predictive dispersion and also improves forecasting and decision making by users of accounting information.