دانلود رایگان مقاله چگونگی اطلاعات درآمد متوالی روند بازار

abstract

Employing both experimental market and archival research designs, we examine whether the association between announcement period stock returns and contemporaneous news is influenced by previously disclosed earnings news. Our primary conclusion is that investors' response to the earnings surprise (actual earnings less the last forecast of the quarter) is conditional on the sign of prior earnings news (i.e., the forecast revision). We develop and test predictions based on behavioral theories of how investors will react to a series of earnings information. Our results suggest that the market's response to sequential analysts' forecasts is consistent with the application of an end-of-sequence (EoS) process resulting in a primacy effect

6. Conclusion

We examine whether the association between earnings announcement period stock returns and contemporaneous earnings news is influenced by previously disclosed earnings news. Our primary conclusion is that investors' response to the earnings surprise (actual earnings less the last forecast of the quarter) is conditional on the sign of prior earnings news (i.e., the forecast revision). We develop and test predictions based on behavioral theories of how investors will react to a series of earnings information. Our study provides two contributions. First, it extends the literature on individual belief revision to an empirical market setting. Prior experimental research indicates that when individuals are presented with a series of information items, their decisions are systematically influenced by how they process the information (Hogarth & Einhorn, 1992). However, economic theory suggests that in a market context, the method of information processing should be an irrelevant factor in the pricing decision. The competitive process inherent in the market is thought to influence how market participants formulate and revise their beliefs, mitigating or even eliminating cognitive strategies. The results of this study suggest that individual cognitive strategies survive the capital market aggregation process and significantly contribute to the overall market valuation of earnings-related news.