Dark Market Share around Earnings Announcements and Speed of Resolution of Investor Disagreement

2021 ◽  
Author(s):  
Karthik Balakrishnan ◽  
Xanthi Gkougkousi ◽  
Wayne R. Landsman ◽  
Peeyush Taori
Keyword(s):  
Market Share ◽  
Earnings Announcements ◽  
Accounting Information ◽  
Market Quality ◽  
Informational Efficiency ◽  
Positive Relation ◽  
High Quality ◽  
Earnings Announcement ◽  
Market Fragmentation ◽  
Investor Disagreement

This study examines how the market share of dark venues changes at earnings announcements. Our analysis shows a statistically significant increase in dark market share in the weeks prior to, during, and following the earnings announcement. We also predict and find evidence that increases in dark market share around earnings announcements are higher for firms with high quality accounting information. In addition, we find a positive relation between the change in dark market share and the speed of resolution of investor disagreement-a key dimension of informational efficiency, which suggests that dark trading is associated with an improvement in market quality. How market fragmentation changes around news events, the role accounting information plays in market fragmentation, and how changes in market fragmentation relate to market quality can help provide insights to securities regulators.

Asymmetric Timeliness and the Resolution of Investor Disagreement and Uncertainty at Earnings Announcements

2019 ◽  
Vol 95 (4) ◽  
pp. 23-50 ◽  
Author(s):  
Mary E. Barth ◽  
Wayne R. Landsman ◽  
Vivek Raval ◽  
Sean Wang
Keyword(s):  
Stock Returns ◽  
Earnings Announcements ◽  
Investment Decisions ◽  
Bad News ◽  
Positive Relation ◽  
Potential Cost ◽  
Earnings Announcement ◽  
Asymmetric Timeliness ◽  
Valuation Uncertainty ◽  
Investor Disagreement

ABSTRACT This study finds that greater asymmetric timeliness of earnings in reflecting good and bad news is associated with slower resolution of investor disagreement and uncertainty at earnings announcements. These findings indicate that a potential cost of asymmetric timeliness is added complexity from requiring investors to disaggregate earnings into good and bad news components to assess the implications of the earnings announcement for their investment decisions. Such a disaggregation impedes the speed with which investor disagreement and uncertainty resolve. The findings indicate that asymmetric timeliness also delays price discovery at earnings announcements. We also find a positive relation between asymmetric timeliness and stock returns during the earnings announcement period after the initial price reaction to the announcement, which is consistent with resolution of valuation uncertainty. However, we do not find clear evidence of more net stock purchases during this period by insiders of firms with greater asymmetric timeliness. JEL Classifications: M41; G14.

Are Investors Influenced by the Order of Information in Earnings Press Releases?

2020 ◽  
Author(s):  
Lin Cheng ◽  
Darren T. Roulstone ◽  
Andrew Van Buskirk
Keyword(s):  
Experimental Evidence ◽  
Earnings Announcements ◽  
Negative Information ◽  
Positive Relation ◽  
Press Releases ◽  
Cognitive Effect ◽  
Earnings Announcement ◽  
Quarterly Earnings ◽  
Earnings Information ◽  
Earnings Press Releases

We examine how the ordering of information within quarterly earnings announcements influences investor response to those announcements. Specifically, we examine whether earlier discussion of earnings information, and earlier discussion of qualitatively positive or negative information, is associated with stronger responses to that information. Controlling for the linguistic content of the earnings announcement, we find a positive relation between investor response to information and the prioritization of that information in the earnings announcement. We find no evidence of investor overreaction and, to the contrary, find some evidence that investors underreact to prioritized information. Our evidence, in conjunction with experimental evidence in Elliott (2006), suggests that information placement influences investors' responses. However, unlike the experimental evidence in Elliott (2006), our archival results suggest that investor response to information placement is warranted, rather than the result of an unintentional cognitive effect.

Institutional Holdings and Trading Volume Reactions to Quarterly Earnings Announcements

1997 ◽  
Vol 12 (1) ◽  
pp. 1-14 ◽  
Author(s):  
Jeong-Bon Kim ◽  
Itzhak Krinsky ◽  
Jason Lee
Keyword(s):  
Trading Volume ◽  
Earnings Announcements ◽  
Institutional Ownership ◽  
Positive Relation ◽  
Earnings Announcement ◽  
Quarterly Earnings ◽  
Price Reaction ◽  
Institutional Holdings ◽  
Abnormal Trading Volume

This paper empirically examines the incremental relation between trading volume surrounding quarterly earnings announcements and institutional holdings. Consistent with Cready (1988) and Lee (1992), we find a significant positive relation between abnormal trading volume and the fraction of institutional ownership during the period immediately following an earnings announcement, after controlling for the magnitude of the associated price reaction and the dispersion of analysts' EPS forecasts. The results are robust to various measures of abnormal trading volume. Our findings suggest that newly released information does not necessarily have the same value to heterogeneous investor types and support Lev's (1988) emphasis on the importance of focusing on investor classes.

Stock Price Behavior Associated with Post-1974–75 LIFO Adoptions Announced at Alternative Disclosure Times

1996 ◽  
Vol 11 (4) ◽  
pp. 535-564 ◽  
Author(s):  
Morton Pincus ◽  
Charles E. Wasley
Keyword(s):  
Stock Prices ◽  
Stock Price ◽  
Earnings Announcements ◽  
Market Response ◽  
Price Behavior ◽  
Positive Information ◽  
Earnings Announcement ◽  
Earnings Growth ◽  
Adoption Decision ◽  
Annual Earnings

We examine the behavior of stock prices at the time of post-1974–75 LIFO adoption announcements. We exploit recent theoretical and empirical developments in the LIFO adoption literature in an attempt to resolve some of the mixed findings in Hand (1993). We study LIFO adoptions announced prior to as well as at the time of annual earnings announcements. Previous research has mostly centered on 1974–75 adoptions made at the time of annual earnings announcements. Our study of LIFO adoptions announced prior to annual earnings announcement dates enables us to provide evidence on whether the early announcement of a LIFO adoption is used by firms to signal positive information about earnings growth. Collectively, our results suggest that in explaining the market response to LIFO adoption announcements, extant models of the LIFO adoption decision do not fully capture the richness of differing inflationary environments or of alternative disclosure times.

scholarly journals Measuring The Usefulness Of Information For Investors Inferences: The Case Of Quarterly Earnings Announcements

2010 ◽  
Vol 8 (7) ◽  
Author(s):  
C. Catherine Chiang ◽  
Yaw M. Mensah
Keyword(s):  
Financial Performance ◽  
Stock Price ◽  
Value Of Information ◽  
Earnings Announcements ◽  
New Method ◽  
Rates Of Return ◽  
Earnings Announcement ◽  
Quarterly Earnings ◽  
Other Information

In this paper, we propose a new method for assessing the usefulness of information, its inferential value. In the context of accounting and finance, we define the inferential value of information about a firm as how efficaciously the information enables investors to draw correct inferences regarding its future financial performance. On the basis of this definition, we develop a stylized model to measure the proximity of a firm’s future realized rates of return to the estimated rates of return implied by its current stock price. We then use the new measure to test the hypothesis that quarterly earnings announcements have a higher inferential value than other information arriving during interim (non-earnings announcement) periods. Our empirical findings suggest that investors are able to make more informative inferences about a firm’s future profitability based on quarterly earnings announcement than based on information available during interim periods. However, our findings also suggest that, in general, investors do not correctly anticipate future losses. Finally, we find that earnings announcements are as important in anticipating future profitability for larger firms as they are for smaller firms.

scholarly journals EARNINGS ANNOUNCEMENTS AND COMPETING INFORMATION: THE INDONESIAN EVIDENCE

2015 ◽  
Vol 29 (1) ◽  
Author(s):  
Dedhy Sulistiawan ◽  
Jogiyanto Hartono ◽  
Eduardus Tandelilin ◽  
Supriyadi Supriyadi
Keyword(s):  
Stock Market ◽  
Empirical Evidence ◽  
Earnings Announcements ◽  
Negative Relationship ◽  
Technical Analysis ◽  
Earnings Announcement ◽  
Price Reaction ◽  
Price Reactions ◽  
The Relationship ◽  
The U.S

The main purpose of this study is to provide empirical evidence of the relationship betweeninvestors’ responses to two events, which are, (1) earnings anouncements, and (2) technicalanalysis signals, as competing information. This study is motivated by Francis, et al. (2002),whose study used stock analyst’s recommendations as competing information in the U.S stockmarket. To extend that idea, this study uses technical analysis signals as competing informationin the Indonesian stock market. Using Indonesian data from 2007-2012, this study shows thatthere are price reactions on the day of a technical analysis signal’s release, which is prior toearnings announcements. It means that investors react to the emergence of competinginformation. Reactions on earnings announcements also produce a negative relationship withthe reaction to a technical analysis signal before an earnings announcement. This study givesevidence about the importance of technical analysis as competing information to earningsannouncements.Keywords: competing information, earnings announcements, technical analysis, price reaction

scholarly journals Multimodal Analysis of Innisfree’s Brand History

K ta Kita ◽  
2020 ◽  
Vol 8 (3) ◽  
pp. 262-269
Author(s):  
Vanessa Velancia Prajogo ◽  
Setefanus Suprajitno
Keyword(s):  
Key Words ◽  
Market Share ◽  
Common Method ◽  
Brand Identity ◽  
High Quality ◽  
Visual Mode ◽  
Multimodal Analysis ◽  
Semiotic Resources ◽  
Fierce Competition

Fierce competition in increasing market share growth prompts companies to strive to create a memorable brand identity. One common method adopted by some companies is using a video advertisement, which contains the message they want to convey about their product or brand. This message is intended to persuade people who see the advertisement to buy their product. In doing so, companies usually use the visual, linguistic, spatial and other semiotic resources, often referred to as a semiotic mode. Through the case study of Innisfree’s video advertisement “Brand History,” we analyze how Innisfree uses linguistic, spatial, and visual mode for creating a message that enables consumers to remember and to persuade them buy its product. Our findings show that the message in the video advertisement is that Innisfree is a beauty product that upholds nature as its ingredients, has high quality, and preserves the environment where it takes its ingredients. Key Words: Advertisement, Persuasion, Modes, Verbal and Non-verbal expressions.

scholarly journals IPTEKS PENGGUNAAN MODAL PADA USAHA KECIL DAN MENENGAH MENGGUNAKAN LAPORAN KEUANGAN AKUNTANSI

2018 ◽  
Vol 2 (02) ◽  
Author(s):  
Tesalonika Theresa Mutiara Lonto ◽  
Sonny Pangerapan
Keyword(s):  
Information System ◽  
Market Share ◽  
Small And Medium Enterprises ◽  
Accounting Information ◽  
Financial Statements ◽  
Accounting Information System ◽  
Advantages And Disadvantages ◽  
Medium Enterprises ◽  
Starting A Business

Small and medium enterprises are businesses run by a person / group of people to build a business. To run it you should use financial statements with an accounting information system. Because, using financial statements can find out the advantages and disadvantages of the business being run. When starting a business, we must find out the strategic place and market share that will become the place of business to run. By doing all that is needed we can do business well. Through this research, it was explained how to run a business by getting a loan from the Office of Cooperatives and Small and Medium Enterprises and ways to obtain these loans. This study also aims to find out how to run a business using financial statements with accounting information systems.Keywords: evaluating, effectiveness, grant disbursement procedure

The Incremental Value Relevance of Media Coverage of Earnings Announcements: Evidence from the Trading of Short Sellers

2021 ◽  
Author(s):  
Lynn Rees ◽  
Brady Twedt
Keyword(s):  
Media Coverage ◽  
Price Discovery ◽  
Value Relevance ◽  
Earnings Announcements ◽  
Discovery Process ◽  
Trading Behavior ◽  
Earnings Announcement ◽  
Short Sellers ◽  
The Media ◽  
Price Discovery Process

We investigate the relation between media coverage and the trading behavior of short sellers around earnings announcements. Prior research provides conflicting evidence on the role of the media, with some studies finding that the media can impede the price discovery process. Our evidence indicates that short sellers increase their activity in line with the tone of media coverage around earnings announcements, after controlling for earnings news and other factors that affect relative levels of short selling. Furthermore, we show that information in the media successfully forecasts earnings information in the days leading up to the earnings announcement, and that short sellers trade in a manner consistent with information reflected in media coverage preceding the earnings announcement. Our findings are consistent with information contained in the media having value relevance, and suggest that the media may help to facilitate the price discovery process around the release of earnings.

Sign in / Sign up

Export Citation Format

Share Document