Investment banks frequently hire analysts from rating agencies. A widely held view is that this “revolving door” undermines analysts’ incentives to issue accurate ratings. Using a hand-collected dataset of the performance and career paths of 245 credit analysts between 2000 and 2009, I show that the ratings by analysts who move to investment banks are on average more accurate than those by thei...

This paper examines how equity analysts affect corporate liquidity policy and the value of cash. Greater analyst coverage reduces information asymmetry between a firm and outside shareholders and enhances the monitoring process, in turn increasing the value of cash and allowing firms to hold more cash. The cash-to-assets ratio increases by 5.2 percentage points when moving from the bottom analy...

The literature assumes that the order and timing of analysts’earnings forecasts are determined exogenously. Ignoring strategic timing decisions of analysts may lead to inconsistent estimates of investors’beliefs. The paper analyzes the equilibrium timing strategies for analysts, and derives the consistent estimates of investors’beliefs. I follow the literature in assuming that analysts care for...