Post-Earnings Announcement Drift (Paperback) (ISBN-13: 9783843367813)

It is a well documented finding in finance theory that share prices drift in the direction of firms' unexpected earnings changes, a phenomenom known as post-earnings announcement drift, or earnings momentum. In this book, I study the stock prices' reaction to firms' quarterly earnings announcements. The book shows that the timeframe in which the drift occurs is related to the size of a firm and is limited in time after the earnings announcement. I further analyze the effect of the number of analysts covering a firm on the magnitude and persistance of post-earnings announcement drift. I document that recent analyst coverage predicts large drifts after the earnings announcements. I suggest several possible explanations, but the evidence seems most consistent with recent analyst coverage providing information about investor (or analyst) expectations regarding firm's future earnings. This book should be useful to professionals in Financial Economics, especially to those interested in Behavioral Finance in stock markets, but also to equity analysts, traders or investors interested in the stocks' response to earnings news.

Author: Tomas Tomcany
ISBN-10: 3843367817
ISBN-13: 9783843367813
Publisher: LAP Lambert Academic Publishing
Language: English
Published: 11/29/2010
Pages: 92
Format: Paperback
Weight: 0.32lbs
Size: 9.00h x 6.00w x 0.22d