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 Korean Journal of Financial Studies 2013;42(4):733-757. Published online September 30, 2013.
 The Effect of Dividend Changes on the Subsequent Analysts Earnings Forecasts Chunuk Hong, Kyung Jin Park, Seong Hyo Lee 기업의 배당변화가 애널리스트의 이익추정행태에 미치는 영향 홍춘욱, 박경진, 이성효 Abstract Since 2000, there have been many studies on the analysts earnings forecasts in Korea. None, however, tried to relate it to the dividend information of the firms. According to the dividend signalling hypothesis, the dividend announcement has the informational contents on the firms future earnings. And, therefore, the analysts earnings forecasts can be affected by the preceding dividend announcements. This study investigated the earnings forecasts behavior of the analysts with regard to the preceding dividend information. We, first, analysed the peculiar properties of the analysts earnings forecasts in Korea. The Korean analysts tend to forecast optimistically at the beginning of each fiscal year and revise their forecasts downwards through the year. Next, we investigated whether the dividend announcement information affected the subsequent analysts earnings forecasts. The empirical results showed that the analysts earnings forecasts, on average, had been revised to the same direction with the preceding dividend changes. Regardless so called ‘optimistic tendency of the earnings forecasts’, it was found that the earnings forecasts following dividend increase announcements were revised upwards. We also found that the deviation of the forecasts from actual earnings decreased significantly right after the dividend announcements. These findings suggest that the dividend announcements have the informational contents regarding future earnings of the firms and, thus, reduce the uncertainty about the firms future earnings. Key Words: 배당공시,신호가설,애널리스트,이익정보,이익추정,Analysts,Dividend Announcements,Earnings Forecasts,Earnings Information,Signalling Hypothesis