Do sell-side analysts react too pessimistically to bad news for minority-led firms? Evidence from target price valuations
研究发现，当CEO为非白人时，坏消息对分析师估值的负面影响比白人CEO企业大57%，导致估值更悲观，但这种种族差距缺乏经济合理性，后续12个月非白人CEO企业更可能超越估值目标。
We find that the adverse impact of bad news on analysts’ valuations is 57% larger when the CEO is Non-White, resulting in more pessimistic valuations for Non-White CEOs relative to their White counterparts. Non-White CEO firms are more likely to surpass analysts’ valuation targets in the subsequent 12 months, suggesting that this racial gap lacks economic justification. To provide further evidence of a racial bias: (1) we triangulate our empirical findings with corroborating evidence from a controlled experiment and (2) we provide evidence that analysts’ valuation disparities towards Non-White CEO firms become larger when race relations are worse. Increases in CEO familiarity attenuate these disparities, suggesting the bias we document appears to be subconscious. Our findings suggest that resources allocated towards educating a firm’s stakeholders about the potential impact of implicit racial biases and increasing self-awareness may be impactful in promoting equality within capital markets.