Paper Title
Do Analysts Signal The Future Effect of Firms’ Over Investment?

Abstract
This study examines whether the companies’ investment decisions affect the publication of analysts’ long-term growth forecasts. Using public U.S. firms for the period from 2000 to 2014, we document a positive relation between overinvestment and the long-term growth forecast issuance. This positive relation is more pronounced for firms covered by more competent analysts and for firms with more earnings management. In addition, analysts provide more negative forecasts as the magnitude of overinvestment increases. Overall, the findings are consistent with the notion that investment decision is an important determinant of analysts’ long-term forecasts in analyzing the firms’ long-term prospects. Index Terms - Earnings management, Long-term Analyst forecasts; Overinvestment