Analyst coverage: does the listing location really matter?

Hassan, Omaima A.G.; Skinner, Frank S.

Abstract

Using a count panel regression method, we find that the listing location really does matter as stocks listed on the main board (FTSE350) rather than the junior market (AIM) attract more analyst coverage than can be explained by existing factors, even when we control for listing requirements and the type of cross-listing. We also find that listing requirements have a significantly greater impact on the number of analysts following AIM companies rather than their FTSE350 counterparts. Moreover, pooling stocks from different listing locations can conceal additional differences in the determinates of analyst services for the main board and junior markets. For example, cross-listing on a stock exchange increases analysts coverage for FTSE350 stocks but not AIM stocks and listing on less transparent trading venues such as over the counter and alternative trading systems (dark pools) decreases analyst coverage, especially for AIM stocks.

Citation

HASSAN, O.A.G. and SKINNER, F.S. 2016. Analyst coverage: does the listing location really matter? International review of financial analysis [online], 46, pages 227-236. Available from: https://doi.org/10.1016/j.irfa.2016.05.008

• Journal Article Type: Article
• Acceptance Date: May 21, 2016
• Online Publication Date: May 25, 2016
• Publication Date: Jul 31, 2016
• Deposit Date: Feb 2, 2017
• Publicly Available Date: Feb 2, 2017
• Journal: International review of financial analysis
• Print ISSN: 1057-5219
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 46
• Pages: 227-236
• DOI: https://doi.org/10.1016/j.irfa.2016.05.008
• Keywords: Analyst coverage; Analysts following; Security analyst; FTSE350; AIM; Alternative trading systems
• Public URL: http://hdl.handle.net/10059/2148
• Contract Date: Feb 2, 2017