Media coverage and price reactions to earnings news

IF 1.9 Q2 BUSINESS, FINANCE China Journal of Accounting Research Pub Date : 2024-07-18 DOI:10.1016/j.cjar.2024.100379
Miao Yu , Hangsoo Kyung , Albert Tsang
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Abstract

In this study, we find that relative to firms with less media coverage, stock price sensitivity to positive (negative) earnings surprises in earnings announcements of firms with greater media coverage is stronger (weaker). This asymmetry in the effect of media coverage on stock price sensitivity to positive versus negative earnings surprises suggests that greater media coverage of earnings announcements intensifies stock price reactions to positive earnings surprises but attenuates reactions to negative earnings surprises. Moreover, we find that negative earnings news is less persistent for firms with greater media coverage. Overall, our findings support the conjecture that greater media coverage increases managers’ incentive to avoid future negative news, thereby reducing the persistence of poor financial performance and weakening price reactions to negative earnings news.

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盈利新闻的媒体报道和价格反应
在本研究中,我们发现相对于媒体报道较少的公司,媒体报道较多的公司的盈利公告中的正面(负面)盈利意外对股价的敏感性更强(更弱)。媒体报道对股价对正面与负面盈利意外敏感性影响的这种不对称性表明,盈利公告的媒体报道越多,股价对正面盈利意外的反应就越强烈,但对负面盈利意外的反应就会减弱。此外,我们还发现,对于媒体报道较多的公司而言,负面盈利新闻的持续性较低。总体而言,我们的研究结果支持这样的猜想,即更大的媒体报道会增加管理者避免未来负面新闻的动机,从而降低财务业绩不佳的持续性,削弱股价对负面盈利新闻的反应。
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来源期刊
CiteScore
4.70
自引率
0.00%
发文量
295
审稿时长
15 weeks
期刊介绍: The focus of the China Journal of Accounting Research is to publish theoretical and empirical research papers that use contemporary research methodologies to investigate issues about accounting, corporate finance, auditing and corporate governance in the Greater China region, countries related to the Belt and Road Initiative, and other emerging and developed markets. The Journal encourages the applications of economic and sociological theories to analyze and explain accounting issues within the legal and institutional framework, and to explore accounting issues under different capital markets accurately and succinctly. The published research articles of the Journal will enable scholars to extract relevant issues about accounting, corporate finance, auditing and corporate governance related to the capital markets and institutional environment.
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