We predict earnings for forecast horizons of up to five years by using the entire set of Compustat financial statement data as input and providing it to state-of-the-art machine learning models capable of approximating arbitrary functional forms. Our approach improves prediction one year ahead...

This study explores how IFRS adoption is associated with analysts' forecast accuracy, optimism, and dispersion in Saudi Arabia. Drawing on data from publicly listed firms from 2013 to 2020, we assess changes in forecasting behavior surrounding the IFRS transition, accounting for firm-specific...

We investigate how the accounting treatment of intangible assets on managers' likelihood of issuing voluntary earnings guidance (MEF). We find that unrecognized intangibles (immediately expensed) are negatively associated with MEF issuance, while recognized intangibles (capitalized) show a...

In this study, we find that relative to firms with less media coverage, stock price sensitivity to positive (negative) earnings surprises in earnings announcements of firms with greater media coverage is stronger (weaker). This asymmetry in the effect of media coverage on stock price sensitivity...

Corruption within corporate entities continues to be a relatively overlooked yet significant issue to date. This study seeks to investigate the impact of corruption on the quality of earnings. The sample comprises 846 firm-years listed on the Indonesian Stock Exchange. Earnings quality...

Several prior studies indicate that financial analysts exhibit systematic underreaction to information; others illustrate systematic overreaction. We assume that cognitive biases influence analysts' behavior and that these misreactions are not systematic, but they depend on the nature of news....

Previous research finds that historical seasonal earnings rank negatively predicts stock returns surrounding earnings announcements (EAs) in China’s A-share markets. We examine whether management earnings forecasts (MEFs) help reduce the stock return seasonality associated with earnings...

This study finds that the introduction of the Current Expected Credit Loss (CECL) model, which requires banks to estimate forward-looking loan loss provisions, is associated with a slower resolution of investor disagreement and uncertainty at earnings announcements. We interpret this finding to...

This paper examines whether sell-side analysts struggle to cope with macroeconomic uncertainty. We find that analysts issue more accurate earnings forecasts when facing higher economic policy uncertainty, which conflicts with the conclusions in the US. We provide a novel explanation for this...

Prior studies find an insignificantly association between differences of opinion (DO) before earnings announcements (EAs) and the returns around the EAs and thereby reject the resale option theory that DO drives overpricing. We posit two issues that may lead to their conclusion to be one-sided....

We adopt an information risk view and hypothesize that low quality financial disclosure related to equity pledging by controlling shareholders impairs analyst forecast quality. We sample Chinese A-share firms and find that the proportion of shares pledged (pledge ratio) by controlling...

In this paper, we provide an estimate of the ex-ante risk premia on earnings announcements based on the option market. We find that the risk premia are time-varying and have predictive power on future stock returns. With our ex-ante risk premia as a measure of uncertainty before each earnings...

Based on a unique arrangement of trading and disclosure times around earnings announcements in the Chinese stock market, we provide evidence of a striking overnight-intraday disparity in terms of the reaction to earnings news. Specifically, we find that the overnight period exhibits a strong and...

This paper investigates whether and how FinTech development affects investors’ utilization of information from corporate earnings announcements. Using FinTech patent applications to characterize regional FinTech development in China, we find that FinTech development significantly reduces stock...

Research documents price comovements or “spillovers” between focal firms and peer firms at focal-firm-earnings announcements. We find signed and absolute comovements between focal-firm and peer-firm returns are significantly lower at earnings-announcement dates compared to non-announcement...

A longstanding literature suggests that earnings provide the market with relevant information about firm performance, but one often overlooked benefit is their role in disciplining market expectations. This study examines the role of earnings announcements in constraining potential mispricing...

We conduct an event study around the earning announcement to examine the asymmetric post earnings announcement drift, and its relationship with the order follow imbalance on post earnings announcement period. The earning drift is significantly asymmetric, stocks with good news have less drift,...

Corporate earnings announcements unpack large bundles of information that should, if markets are efficient, almost surely trigger jumps in stock prices immediately after the news release. Testing this implication is difficult in practice because most earnings announcements occur in the...

When paying fast-thinking attention to the market, individual investors do not process earnings announcements but instead trade attention-grabbing stocks based on technical trends. To study fast-thinking attention, I exploit a setting where the brokerage Robinhood sends millions of its users...