Home
Scholarly Works
Textual fundamentals in earnings press releases
Journal article

Textual fundamentals in earnings press releases

Abstract

I re-examine the information content of earnings press releases (EPRs) by distinguishing textual fundamentals (TF), which captures information content in non-tone language, from tone, which captures optimism and pessimism and is the focus of prior research. I find after controlling for standard firm characteristics, TF positively predicts future operating performance, unlike tone, which negatively predicts future operating performance. I document a return continuation in TF, in contrast to the return reversal in tone documented in prior literature. My findings distinguish informative content in TF and misleading content in tone in EPRs.

Authors

Li K

Journal

Advances in Accounting, Vol. 57, ,

Publisher

Elsevier

Publication Date

June 1, 2022

DOI

10.1016/j.adiac.2022.100591

ISSN

0882-6110

Contact the Experts team