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Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/27574
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| Title: | Earnings Guidance after Regulation FD |
| Authors: | Feldman, Ronen
Lazer, Ron
Livnat, Joshua |
| Issue Date: | 9-Apr-2003 |
| Series/Report no.: | Joshua Livnat-03 |
| Abstract: | This study investigates market reactions to voluntary earnings guidance
provided by managers after the enactment of Regulation FD, which
requires companies to disseminate material news to all investors
simultaneously. More managers now issue their guidance to the public
instead of disclosure to a selective group of analysts, in conformity
with Regulation FD. We examine a very large set of earnings guidance
disclosures based on identification of these announcements using text
mining techniques. Our results indicate that guidance provided with the
disclosure of earnings is not associated with significant market
reactions, but guidance provided between earnings releases is associated
with significant negative reactions. We further show that market
reactions are consistent with the trend implied by management even when
it is in the form of qualitative disclosure. Finally, we show that
market reactions are stronger (more negative, typically) for NASDAQ
firms than NYSE or AMEX firms, larger firms, and when the disclosure
involves revenues and not earnings. |
| URI: | http://hdl.handle.net/2451/27574 |
| Appears in Collections: | Accounting Working Papers
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