Joos, Peter R.Piotroski, Joseph D.Srinivasan, Suraj2016-12-092016Joos, Peter R., Joseph D. Piotroski, and Suraj Srinivasan. "Can Analysts Assess Fundamental Risk and Valuation Uncertainty? An Empirical Analysis of Scenario-Based Value Estimates." Journal of Financial Economics 121, no. 3 (September 2016): 645–663.0304-405Xhttp://nrs.harvard.edu/urn-3:HUL.InstRepos:29660916We use a dataset of sell-side analysts' scenario-based valuation estimates to examine whether analysts reliably assess the risk surrounding a firm's fundamental value. We find that the spread in analysts' state-side contingent valuations captures the riskiness of operations and predicts the absolute magnitude of future long-run valuation errors and changes in fundamentals. Similarly, asymmetry embedded in the analysts' scenario-based valuations conveys information about asymmetric risk-reward exposure and predicts skewness in future long-run valuation errors; however, embedded asymmetry is not correlated with changes in fundamentals. The results confirm that analysts' valuations reflect both state-contingent risk assessments and non-fundamental factors.en-USvaluationrisk and uncertaintyforecasting and predictionJournal Article2014-04-23Suraj Srinivasan2016-12-09