Two Faces of Intra-Industry Information Transfers: Evidence from Management Earnings and Revenue Forecasts

We examine positive and negative intra-industry information transfers associated with management earnings and revenue forecasts. Positive information transfers are due to industry commonalities whereas negative information transfers are caused by competitive shifts within industries. We hypothesize positive information transfers to non-competitor firms and negative information transfers to competitors in the same industry. As predicted, we find negative (positive) intra-industry information transfer between forecasting firms and non-forecasting firms which are more (less) likely to be competitor firms. We also find that industry growth and concentration (i.e., the degree of imperfect competition) are associated with the direction of intra-industry information transfers