The Post‐earnings Announcement Drift: A Pre‐earnings Announcement Effect? A Multi‐period Analysis

For many years, the post‐earnings announcement drift (PEAD) has been accepted as an anomaly to the efficient markets hypothesis. This drift subsequent to earnings announcements has been ascribed to the incomplete incorporation by the market of the information in these earnings announcements. Interestingly, over the past five decades of extensive research, no rational economic explanation of the PEAD has been found. In addition, there has been …