RT Journal Article SR Electronic T1 Analyst Industry Diversification and Earnings Forecast Accuracy JF The Journal of Investing FD Institutional Investor Journals SP 7 OP 14 DO 10.3905/joi.2005.517169 VO 14 IS 2 A1 Kimberly Dunn A1 Siva Nathan YR 2005 UL https://pm-research.com/content/14/2/7.abstract AB This study of the effects of both number of business segments followed by an analyst and analyst industry diversification on individual analyst earnings forecast accuracy applies a new measure of an analyst's diversification. The measure uses a combination of the number of two-digit SIC code business segments reported by the company and the number of two-digit SIC code business segments followed by the individual analyst to calculate an analyst's diversification measure for each analyst-company combination. The analysis indicates that as an analyst follows more business segments and a greater diversification of industry, his earnings forecasts are significantly less accurate. These results have implications for researchers who use analyst earnings forecasts in studies; investors who use forecasts for company valuation; and brokerage firms in evaluating individual analysts and assigning analysts to companies.