This paper examines what impact a firm’s abnormal investment has on analysts’ forecasts. In general, when managers voluntarily disclose forecasts as to future performance, analysts tend to revise their forecasts according to managers’ private information. However, under abnormal investment, even managers may be ignorant of declined business performance caused by their abnormal investment decisions and therefore their forecasts have optimism bias. Also, if such abnormal investment is only for the managers’ personal interests, they may take an initiative to intentionally introduce optimism to their forecasts. Therefore, in case of abnormal investment, investors require analysts to provide further information on management forecasts caused by increased uncertainty, and analysts would re-analyze management forecasts from an monitoring perspective and revise their forecasts in opposition to management forecasts. On the other hand, they may also forecast in agreement with management forecasts because managers’ private information can be still better even if management forecasts are imperfect due to abnormal investment. The empirical results are as follows. First, the higher the level of abnormal investment is, the more frequently analysts revise their forecasts after disclosing management forecasts. Second, the higher the level of abnormal investment is, the more likely analysts are to revise their forecasts in opposition to management forecasts compared to previous ones. Third, the frequency to revise analysts’ forecasts and the likelihood to revise analysts’ forecasts against management forecasts becomes stronger when management forecasts are more optimistic. This represents that the higher level of abnormal investment makes analysts to provide more objective information as to management forecasts. Fourth, all things stated above show only in over-investment, while we cannot any significant association in under-investment. This indicates that analysts recognize greater information risk in over-investment compared to under-investment. This study is meaningful in that it identifies what roles analysts play in monitoring abnormal investment. Also, in addition to prior researches claiming that management forecasts give additional information value to analysts, it contributes by illustrating that the extent to which analysts reflect managers’ information to their revised forecasts varies depending on the information risk and trustworthiness of management forecasts. The results imply that analysts decide the extent to which they take advantage of management forecasts to their forecasts, based on the evaluation in bias and trustworthiness of management forecasts, rather than simply accepting management forecasts themselves.