Management of Reported and Forecast EPS, Investor Responses, and Research Implications

Published Online:https://doi.org/10.1287/mnsc.2017.2832

References

  • Abarbanell J, Park H (2016) Do bright-line earnings surprises really affect stock price reactions? Management Sci. 63(4):1063–1084.LinkGoogle Scholar
  • Barron O (1995) Trading volume and belief revisions that differ among individual analysts. Accounting Rev. 70(4):581–597.Google Scholar
  • Barron OE, Kile CO, O’Keefe TB (1999) MD&A quality as measured by the SEC and analysts’ earnings forecasts. Contemporary Accounting Res. 16(1):75–109.CrossrefGoogle Scholar
  • Barth ME, Kallapur S (1996) The effects of cross-sectional scale differences on regression results in empirical accounting research. Contemporary Accounting Res. 13(2):527–567.CrossrefGoogle Scholar
  • Beaver W, Lambert R, Morse D (1980) The information content of security prices. J. Accounting Econom. 2(1):3–28.CrossrefGoogle Scholar
  • Brown L, Caylor M (2005) A temporal analysis of quarterly earnings thresholds: Propensities and valuation consequences. Accounting Rev. 67(4):423–440.CrossrefGoogle Scholar
  • Bonsall SB, Bozanic Z, Merkley KJ (2015) Managers’ use of forward and non-forward-looking narratives in earnings press releases. Working paper, Pennsylvania State University, State College.Google Scholar
  • Burgstahler D, Chuk E (2010) Earnings precision and the relation between earnings and returns. Working paper, University of Washington, Seattle. http://ssrn.com/abstract=1119400.CrossrefGoogle Scholar
  • Cheong FS, Thomas J (2011) Why do EPS forecast error and dispersion not vary with scale? Implications for analyst and managerial behavior. J. Accounting Res. 49(2):359–401.CrossrefGoogle Scholar
  • Christie A (1987) On cross-sectional analysis in accounting research. J. Accounting Econom. 9(3):231–258.CrossrefGoogle Scholar
  • Cohen D, Hann RR, Ogneva M (2007) Another look at GAAP versus the Street: An empirical assessment of measurement error bias. Rev. Accounting Stud. 12(2):271–303.CrossrefGoogle Scholar
  • Collins D, Kothari SP (1989) An analysis of intertemporal and cross-sectional determinants of earnings response coefficients. J. Accounting Econom. 11(2–3):143–181.CrossrefGoogle Scholar
  • Degeorge F, Patel J, Zeckhauser R (1999) Earnings management to exceed thresholds. J. Bus. 72(1):1–33.CrossrefGoogle Scholar
  • Diether K, Malloy C, Scherbina A (2002) Differences of opinion and the cross section of stock returns. J. Finance 57(5):2113–2141.CrossrefGoogle Scholar
  • Fischer PE, Verrecchia RE (2000) Reporting bias. Accounting Rev. 75(2):229–245.CrossrefGoogle Scholar
  • Francis RN, Olsen J (2011) The out-of-sample prediction of annual operating cash flow: A comparison of regression and naïve forecast models. Working paper, University of Texas at El Paso, El Paso. http://ssrn.com/abstract=2025224.Google Scholar
  • Freeman R, Tse S (1992) A nonlinear model of security price responses to unexpected earnings. J. Accounting Res. 30(2):185–209.CrossrefGoogle Scholar
  • Fudenberg D, Tirole J (1986) A “signal jamming” theory of predation. RAND J. Econom. 17(3):366–376.CrossrefGoogle Scholar
  • Graham JR, Harvey CR, Rajgopal S (2005) The economic implications of corporate financial reporting. J. Accounting Econom. 40(1–3):3–73.CrossrefGoogle Scholar
  • Hermann D, Thomas W (2005) Rounding of analyst forecasts. Accounting Rev. 80(3):805–823.CrossrefGoogle Scholar
  • Holmstrom B (1982) Moral hazard in teams. Bell J. Econom. 13:324–340.CrossrefGoogle Scholar
  • Kaye M (2003) Stocks worth twice the price? Bloomberg (October 3), https://www.bloomberg.com/news/articles/2003-10-02/stocks-worth-twice-the-price.Google Scholar
  • Kormendi R, Lipe R (1987) Earnings innovations, earnings persistence, and stock returns. J. Bus. 60(3):323–345.CrossrefGoogle Scholar
  • Lang M, Lins K, Maffett M (2012) Transparency, liquidity, and valuation: International evidence on when transparency matters most. J. Accounting Res. 50(3):729–774.CrossrefGoogle Scholar
  • Lesmond DA, Ogden JP, Trzcinka CA (1999) A new estimate of transaction costs. Rev. Financial Stud. 12(5):1113–1141.CrossrefGoogle Scholar
  • Ng J, Rusticus TO, Verdi RS (2008) Implications of transaction costs for the post-earnings announcement drift. J. Accounting Res. 46(3):661–696.CrossrefGoogle Scholar
  • Payne J, Thomas W (2011) The torpedo effect: Myth or reality? J. Accounting Auditing Finance 26(2):255–278.CrossrefGoogle Scholar
  • Richardson S, Teoh SH, Wysocki PD (2004) The walk-down to beatable analyst forecasts: The role of equity issuance and insider trading incentives. Contemporary Accounting Res. 21(4):885–924.CrossrefGoogle Scholar
  • Ronen J, Sadan S (1981) Smoothing Income Numbers: Objectives, Means, and Implication (Addison Wesley, Boston).Google Scholar
  • Skinner D, Sloan R (2002) Earnings surprises, growth expectations, and stock returns, or don’t let an earnings torpedo sink your portfolio. Rev. Accounting Stud. 7(2):289–312.CrossrefGoogle Scholar
  • Stein JC (1989) Efficient capital markets, inefficient firms: A model of myopic corporate behavior. Quart. J. Econom. 104(4):655–669.CrossrefGoogle Scholar
  • Teets W, Wasley C (1996) Estimating earnings response coefficients: Pooled versus firm-specific models. J. Accounting Econom. 21(3):279–295.CrossrefGoogle Scholar
  • Thomas S (2002) Firm diversification and asymmetric information: Evidence from analysts’ forecasts and earnings announcements. J. Financial Econom. 64(3):373–396.CrossrefGoogle Scholar
  • White H (1980) A heteroskedasticity-consistent covariance matrix estimator and a direct test for heteroskedasticity. Econometrica 48(4):817–838.CrossrefGoogle Scholar
INFORMS site uses cookies to store information on your computer. Some are essential to make our site work; Others help us improve the user experience. By using this site, you consent to the placement of these cookies. Please read our Privacy Statement to learn more.