The accuracy of earnings forecasts disclosed in IPO prospectuses: The case of the Turkish IPO companies

Download

362-1769-1-PB.pdf

Date

2010-12

Author

Bulut, Halil İbrahim
Er, Bünyamin

Metadata

Show full item record

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Item Usage Stats

278
views

110
downloads

This paper examines the accuracy of earnings forecasts made by Turkish IPO (Initial Public Offering) companies during the period 2002-2007. It is a voluntary requirement for Turkish IPOs to furnish earnings forecasts. Their accuracy is measured by forecast errors, absolute forecast errors and squared forecast errors in this paper. A number of company specific characteristics such as size, age, forecast interval, gearing, proportion of shares retained by owners and both auditing firm and underwriter reputation are also tested. The results of this study show that like IPO forecasts disclosed in most other countries, IPO forecasts disclosed by Turkish companies do overestimate their earnings, on average, by 13.44 %. On an overall basis, the findings of this study can be intrepreted to mean that IPO forecasts disclosed by Turkish companies provide reliable information.

Subject Keywords

Earnings management, Forecast disclosure, Sales forecasts, Forecast accuracy, Determinansts of forecast accuracy, Turkish IPOs

URI

http://www2.feas.metu.edu.tr/metusd/ojs/index.php/metusd/article/view/362
https://hdl.handle.net/11511/58370

Journal

ODTÜ Gelişme Dergisi

Collections

Department of Economics, Article

Suggestions

OpenMETU
Core

The Validity of Fama-French Four Factor Model in Istanbul Stock Exchange / Bereket, Taylan; Gaygısız Lajunen, Esma; Department of Economics (2014) The aim of this thesis is to investigate the size, book-to-market ratio (B/M), and profitability patterns in average returns and testing the viability of Fama-French four factor model in Istanbul Stock Exchange (ISE) over the period between July 2004-June 2013. The comparative performances of capital asset pricing model (CAPM), Fama-French three factor model, and Fama-French four factor model will be examined. Each of these three models is regressed on two different sets of portfolios. That is, monthly exce...
The inflation-hedging properties of Turkish REITs Erol, Işıl; Tirtiroglu, Dogan (Informa UK Limited, 2008-01-01) This study empirically tests the inflation-hedging abilities of Turkish REITs in comparison to the indices of common stocks listed on the Istanbul Stock Exchange (ISE) over the period December 1999 to December 2004. Two main factors motivate this study. First, compared to their counterparts in developed capital markets, Turkish REITs have some important tax incentives as well as flexibility in managing their portfolios. Second, the Turkish economy provides a rare and good opportunity to test the hedging beh...
The Determinants of Fintech emergence: a cross country study Koçer, Meriç Yıldız.; Danışoğlu, Seza; Department of Business Administration (2019) The emergence of Financial Technology (Fintech) entrepreneurship differs across countries over the years. This thesis explores the determinants of Fintech entrepreneurship that emerged in the last decade. To illustrate the effects of possible determinants three historically connected model in Entrepreneurship theory is used. The first model relates the level of Fintech entrepreneurship to economic development level where the relationship found to be positive. The second model argues that a regime switching ...
Managing financial instability in emerging markets: A Keynesian perspective Akyüz, Yılmaz (Orta Doğu Teknik Üniversitesi (Ankara, Turkey), 2008-6) The Keynesian analysis of financial instability as developed by Hyman Minsky provides considerable insights into understanding the nature and dynamics of boom-bust cycles driven by international capital flows in emerging markets. Its main policy conclusion that financial control rather than macroeconomic policy holds the key to financial stability is equally valid. There is, however, need to develop a new approach to financial control and place greater emphasis on managing capital inflows than has hitherto ...
Heterogeneous Effects of Financial Indicators on Firms' Exports: Evidence from Turkish Manufacturing Firms Şahin, Yavuz Selim; Akbostancı Özkazanç, Elif; Department of Economics (2022-12-21) Using an extensive firm-level database that combines customs and balance sheets data, this paper investigates the heterogeneity in the effects of financial indicators on the exports of Turkish manufacturing firms. The panel data estimations for the period 2010-2020 suggest that improvement in the firm-level financial indicators have stimulating effects on the firms’ exports. More specifically, it is found that profitability and liquidity ratios are positively associated with firms’ exports, while increases ...

Citation Formats

H. İ. Bulut and B. Er, “The accuracy of earnings forecasts disclosed in IPO prospectuses: The case of the Turkish IPO companies,” ODTÜ Gelişme Dergisi, vol. 37, no. 3, pp. 221–245, 2010, Accessed: 00, 2020. [Online]. Available: http://www2.feas.metu.edu.tr/metusd/ojs/index.php/metusd/article/view/362.