Abstract
Using staggered climatic disasters in the U.S, we find that earnings forecasts by analysts who experienced a major climatic disaster become less accurate than those by the unaffected analysts within three months after the disaster due to distracted attention. Stock prices respond less strongly to earnings revisions by disaster-zone analysts. Disaster-zone analysts are more likely to reiterate their previous forecasts and strategically allocate their attention to firms of greater importance or salience. Climatic disasters adversely affect the information environment of firms unaffected by the disasters but covered by disaster-zone analysts, suggesting a spillover effect of idiosyncratic shocks via financial intermediaries.
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