From a firm-year perspective, sorting all analysts issuing forecasts for a firm into quartiles, with analysts' forecasts samples exceeding 7700 and stock rating samples exceeding 21000, this paper tests relationship between analysts' earnings forecasts accuracy and recommendations investment value by computing the characteristics and daily returns of the long and short portfolio of each quartile. The results show that there is no strictly positive correlation between forecast accuracy and recommendation profitability. It is also found that superior earnings forecasts does not certainly facilitate superior investment recommendations. In the long portfolios, the third quartile reported highest daily abnormal four-factor adjusted return, which is 0.081%.But it has little difference with the first quartile. The lowest daily abnormal four-factor adjusted return is reported in the second quartile, which is only 0.016%.
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