Final answer:
The statement is true; underwriters' analysts are prohibited from making stock recommendations during the quiet period to prevent any potential influence on the securities pricing and to ensure fair investment practices.
Step-by-step explanation:
The question refers to the regulations during the quiet period in a securities offering. The statement that “an important result of the quiet period is that the underwriters' analysts are prohibited from making recommendations to investors” is true.
During the quiet period, which occurs just before a company goes public or issues new stock, the U.S. Securities and Exchange Commission (SEC) restricts the information that the company and related parties can release to the public. This restriction aims to prevent analysts, particularly those from the underwriting firm, from publishing research or recommendations that might influence the price of the new securities.
Ordinarily, this period starts at the time the company files registration with the SEC and ends 40 days after the stock starts trading. These regulations ensure a level playing field for all investors and prevent potential conflicts of interest that may arise if underwriters' analysts were to issue recommendations during this critical period.