A Comparative Investigation between Estimated and Actual Earnings per Share (EPS) in the Listed Companies of the Tehran Stock Exchange

The aim of this study is to investigate the relationship between Estimated and Actual Earnings per Share in the Listed Companies of the Tehran Stock Exchange. Consequently, the Actual Earnings per Share (AEPS)is used as the dependent variable and Estimated Earnings per Share (EEPS) as the independent variable. Totally, 973 firm-year observations were investigated during the years 2006-2011at the level of 8 different industries. It should be mentioned that 2003 was the first year that managers were required to disclose EEPS in financial reports. E Views software was exerted to analyze the data. Our findings show that the control variables of SIZE and HISTORY donʹt improve the relation between EEPS & AEPS. The Control variable of Dividend per Share (DPS), however, improves this relation that the level of corporate and each industry. The results also indicate that investments by shareholders in the Chemical Products industry in Iran are economical due to the positive relationship between SIZE and AEPS and older companies in the Basic Metals industry have lower AEPS. EEPS by Managers has the most accuracy and precision in Automotive and Parts industry and the lowest in the Chemical Products industry. In 2006, the estimated earnings per share have the lowest accuracy and precision and the accuracy of EEPS by managers was higher in the Main Hall Forum than Sub Forum.