| A sell-side analyst works for a brokerage firm and evaluates companies for future earnings growth and other investment criteria.Sell-side analyst stock recommendation is an analyst’s comprehensive judgment on the intrinsic value of listed companies in comparison with its stock prices.It is of great significance for improving the securities companies’ reputation,optimizing investment strategies,and promoting the dissemination of information.It is also a reflection of the value of analyst’s work.The information explosion caused by the rapid development of information technology has brought huge challenges to the information processing of sell-side analysts.The crossindustry operation of listed companies puts forward higher requirements on the professional knowledge and industry experience of sell-side analysts.In the complex and changeable situation,securities companies continue expanding their analyst reserves,and employ teamwork in analyst stock recommendation.An analyst team is a collection of sell-side analysts within the organization,while an analyst crowd is a collection of sellside analysts that forecast the same stock at the same time beyond the organization.Analyst teams and analyst crowds are obviously different from individual analysts in structure and network properties.The role of these characteristics is of great practical significance as well as theoretical significance.Therefore,this article focus on sell-side analyst stock recommendations in the Chinese stock market,and explores the influence of team characteristics and group characteristics on sell-side analyst stock recommendations from the perspectives of the analyst team and the analyst crowd.First,this research studies the impact of team characteristics on the quality of sellside analyst stock recommendations from the perspective of the team.On the one hand,this research measures the size and relationship-related diversity of the analyst team based on demographics of analysts and explores the impact of team structure on the quality of sell-side analyst stock recommendations.The empirical results suggest an inverted Ushaped relationship between analyst team size and the probability for analyst to accurately recommend stocks.The analysis of the team diversity concludes that a lager gender diversity or educational level diversity is associated with a worse analyst team’s stock recommendation.On the other hand,this research tries to figure out the value of social network within analyst teams in stock recommendations based on analysts’ work information.The empirical results show that the professional connection within the analyst team is helpful to improve the quality of the team’s stock recommendations.Furthermore,the professional connections between analysts make up the professional network within the team.A more dense professional network,which is consist of professional connections between analysts within analyst teams,is associated with a better stock recommendation.However,the strength of connections will weaken the positive impact of professional network density on the quality of stock recommendations.Second,from the perspective of crowd beyond the organization,this research studies the impact of crowd characteristics on the stock recommendations quality of the sell-side analyst crowds.In this paper,all of the stock recommendations which refer to the same stock and are issued at the same day are aggregated into the crowd wisdom.Based on analysts’ work information,this research measures the size,independence,and diversity of the analyst crowd,and explores the effect of crowd characteristics on the quality of analyst groups’ stock recommendations.The results imply that the crowd size,as well as the diversity of crowd opinions can help increase the value of the analyst crowd wisdom.However,the density of professional network in analyst crowd will impair the value of analyst crowd wisdom through destroying the crowd independence.Based on sell-side analyst stock recommendations,this research employs econometrics research methods and machine learning methods to study the impact of the team characteristics as well as crowd characteristics on the quality of analyst stock recommendations.This research enriches the literature on analysts’ behavior from the perspective of team crowd;fills the research gaps in studies related to characteristics of the analyst team and crowd;expanded the applicable boundaries of team model,social capital theory and crowd wisdom theory;provides a new perspective for analyst behavior research.This research is of great significance in practice.The conclusions of this research provide suggestions for securities companies to optimize the allocation of analysts and enhance their competitiveness,inform investors of more optimized investment strategies,promote the value of analysts’ stock recommendations,and contributes to the information dissemination and efficiency of the stock market. |
