Timeliness of Reporting and the Stock Price Reaction to Earnings Announcements

Chambers, A.; Penman, Stephen H.

doi:10.2307/2490700

Cited by 587 publications

(362 citation statements)

References 14 publications

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“…According to Chambers and Penman (1984), firms that do not announce earnings early send signals of negative news and thus earn negative pre-announcement and post-announcement abnormal returns. These arguments therefore may provide some explanation for the results we have found in this study.…”

Section: Discussion Of Findings and Implicationsmentioning

confidence: 99%

“…Market regulators and policy makers need to impose penalties on companies that delay the release of their results. According to Chambers and Penman (1984), firms that do not announce earnings early, send negative signals to market participants, and this may result in speculative investment behaviour. Timely release of financial information therefore is expected to help discourage unnecessary speculation by investors while it attracts investors, boosts liquidity and helps improve the informational efficiency of the stock market.…”

Section: Conclusion and Recommendationsmentioning

confidence: 99%

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Stock Price Response to Earnings Announcements: Evidence From the Nigerian Stock Market

Afego

2013

Journal of African Business

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This paper examines the stock market reaction to annual earnings information releases using data on the Nigerian Stock Exchange. Using the event study method, the speed of reaction of the market to annual earnings information releases for a sample of 16 firms listed on the exchange is tested. Significant abnormal price reactions around earnings announcements suggest the earnings announcements contain value-relevant information. We find that the magnitude of the cumulative abnormal returns is dominated by significant reactions 20 days before the earnings release date which suggests that a portion of the market reaction may be due to private acquisition and, possibly, abuse of information by insiders. The persistent downward drift of the cumulative abnormal returns, 20 days after the announcement, is inconsistent with the efficient markets hypothesis, and therefore suggests that the Nigerian stock market does not efficiently adjust to earnings information for the sample firms within the study period.

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Section: Discussion Of Findings and Implicationsmentioning

confidence: 99%

Section: Conclusion and Recommendationsmentioning

confidence: 99%

Stock Price Response to Earnings Announcements: Evidence From the Nigerian Stock Market

Afego

2013

Journal of African Business

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“…Previous studies also suggest that the earlier the earnings are reported, the higher the return because announcing earnings earlier (later) than expected is, on the average, viewed positively (negatively) by the market (Chambers & Penman, 1984;Kross & Schroeder, 1984;Begley & Fischer, 1998). The value of information from an audited financial statement will decline as the announcement of earnings is delayed because older information is considered to have decreasing relevance (FASB, 1980).…”

Section: A Good News Early and Bad News Latementioning

confidence: 94%

“…Prior studies have examined the timing of earnings announcement and the sign sign of the earnings news, and they generally find that good news is announced early and bad news late (e.g., Kross, 1981;Givoly & Palmon, 1982;Chambers & Penman, 1984;Kross & Schroeder, 1984;Begley & Fischer, 1998;Haw et al, 2003;Kothari et al, 2005). Career concerns like promotion, employment opportunities within and outside the firm, and loss of employment can motivate managers to withhold bad news and seek an opportunity such as subsequent corporate events (i.e., future corporate turnaround or restructuring) to bury the bad news (Kothari et al, 2005).…”

Section: A Good News Early and Bad News Latementioning

confidence: 99%

“…This goodnews-early, bad-news-late phenomenon is probably due to higher market returns on earnings announced in a timelier manner. Chambers and Penman (1984), for example, observe positive abnormal returns for announcements that are earlier than expected, indicating that delayed reports are likely to carry bad news. The good-news-early, bad-news-late phenomenon in an extreme form suggests a positive association between the magnitude of unexpected earnings and the timing of earnings announcement (Begley & Fischer, 1998).…”

Section: ⅰ Introductionmentioning

confidence: 99%

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The Association between Earnings News and The Timing of Annual Earnings Announcements

Kim¹,

Son²

2014

Glob Bus Financ Rev

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A B S T R A C TThis study examines whether managers exercise discretion in the timing of annual earnings announcements depending on the magnitude of unexpected earnings. We find a non-linear association between the timing of the earnings announcement and the amount of unexpected earnings. Specifically, managers tend to delay annual earnings announcements as the news becomes worse (better) in negative (positive) unexpected earnings. We also find that market returns on the magnitude of earnings surprises (Earnings Response Coefficient) are greater with the timely announcement of earnings only when firms miss their expected earnings.

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SEntFiN 1.0: Entity‐aware sentiment analysis for financial news

Sinha

Kedas

Kumar

et al. 2022

Asso for Info Science & Tech

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Fine-grained financial sentiment analysis on news headlines is a challenging task requiring human-annotated datasets to achieve high performance. Limited studies have tried to address the sentiment extraction task in a setting where multiple entities are present in a news headline. In an effort to further research in this area, we make publicly available SEntFiN 1.0, a humanannotated dataset of 10,753 news headlines with entity-sentiment annotations, of which 2,847 headlines contain multiple entities, often with conflicting sentiments. We augment our dataset with a database of over 1,000 financial entities and their various representations in news media amounting to over 5,000 phrases. We propose a framework that enables the extraction of entity-relevant sentiments using a feature-based approach rather than an expression-based approach. For sentiment extraction, we utilize 12 different learning schemes utilizing lexicon-based and pretrained sentence representations and five classification approaches. Our experiments indicate that lexicon-based N-gram ensembles are above par with pretrained word embedding schemes such as GloVe. Overall, RoBERTa and finBERT (domain-specific BERT) achieve the highest average accuracy of 94.29% and F1-score of 93.27%. Further, using over 210,000 entity-sentiment predictions, we validate the economic effect of sentiments on aggregate market movements over a long duration.

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Timeliness of Reporting and the Stock Price Reaction to Earnings Announcements

Cited by 587 publications

References 14 publications

Stock Price Response to Earnings Announcements: Evidence From the Nigerian Stock Market

Stock Price Response to Earnings Announcements: Evidence From the Nigerian Stock Market

The Association between Earnings News and The Timing of Annual Earnings Announcements

SEntFiN 1.0: Entity‐aware sentiment analysis for financial news

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