Abstract
The primary aim of this study is to determine whether there is any association between stocks with lottery-like characteristics and the analyst revisions carried out on such stocks. Given that lottery-like stocks generally tend to be overpriced and have inferior performance to non-lottery-like stocks, analysts are more likely to issue downgrade recommendations on the former than the latter. Analysts have the ability to identify which lottery-like stocks are ‘dark horses’ with good investment potential, and indeed, their revisions on lottery-like stocks are generally found to have a larger stock-price impact than those on non-lottery-like stocks. Lottery-like stocks are also associated with sentiment-driven overpricing, with market sentiment potentially strengthening the negative price response to revisions from ‘buy’ to ‘sell’ for lottery-like stocks; however, such sentiment can also weaken the positive price response to revisions from ‘sell’ to ‘buy’ for lottery-like stocks.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
