COVID-19 pandemic, limited attention, and analyst forecast dispersion.

This paper investigates the effect of the COVID-19 pandemic on analysts' forecast dispersion. We find that analysts' exposure to the COVID-19 lockdown reduces the dispersion of their forecasts. Along with the forecast dispersion, the number of earnings forecasts issued by treated analysts decreases, supporting the channel of attention distraction. Moreover, there is no significant difference between optimistic and pessimistic forecasts, against the explanation of risk attitude change. We find our conclusion is robust to a staggered DID model and numerous robustness tests. Our finding contributes to the dispute regarding the pandemic's effect on analyst forecast behavior.