Publication Type

Journal Article

Publication Date

2010

Abstract

We examine the relationship between analyst research and corporate earnings announcements to explore the relative importance of information discovery versus interpretation of previously released information. Using equity market reaction to capture information content, we find that information discovery (interpretation) dominates in the week before (after) firms announce their earnings. In addition, we find that the interpretation role increases in importance with the difficulty of financial accounting information. Analysis of all weeks surrounding earnings announcements shows that the information discovery role is overall more important. We are able to reconcile this result with the opposite finding in Francis et al. (2002).

Keywords

Analyst research, Information content, Earnings announcements, Information discovery

Discipline

Accounting | Corporate Finance

Research Areas

Corporate Reporting and Disclosure

Publication

Journal of Accounting and Economics

Volume

49

Issue

3

First Page

206

Last Page

226

ISSN

0165-4101

Identifier

10.1016/j.jacceco.2009.12.004

Publisher

Elsevier

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