1. Critically discuss the role of non-financial information – e.g., intellectual capital information – in analysts’ forecasts, valuation and investment recommendation decisions, and analysts’ formation of a view about the companies they cover. (Students are expected to demonstrate familiarity with relevant literature.)
2. Discuss the following statement made by a hedge fund manager: “It is not worth the time to develop detailed fundamentals-based forecasts of earnings and free cash flows. It is quicker, easier and as accurate just to use some random walk models to forecast earnings and free cash flows.”