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This is a Quantitative Study study.

Analysts’ cash flow forecasts and the underreaction to earnings forecast revisions

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Analysis shows cash flow forecasts strengthen market response to earnings adjustments, suggesting reduced information uncertainty.

Market reaction to earnings forecast revisions is stronger with cash flow forecasts available, improving investor decision-making.
Stock price drift following earnings forecast revisions is significantly reduced when cash flow forecasts are present, according to a three-month analysis.
Findings contribute to understanding how cash flow forecasts impact market efficiency and reduce uncertainty in analyst projections.
The study extends previous research on post-earnings forecast drift, providing new insights into investor behavior.

Perotti et al. (2025) studied this question.

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