14-Week Quarters

Johnston, Rick; Leone, Andrew J.; Ramnath, Sundaresh; Yang, Ya-Wen

doi:10.2139/ssrn.1463646

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14-Week Quarters

48 Pages Posted: 29 Aug 2009

See all articles by Rick Johnston

Sundaresh Ramnath

University of Miami - Department of Accounting

Ya-Wen Yang

Wake Forest University - Schools of Business

There are 2 versions of this paper

Date Written: August 28, 2009

Abstract

Many firms define their fiscal quarters as 13-week periods. For these firms each fiscal year contains 52 weeks, which leaves out one/two day(s) a year. To compensate, one extra week is added to every fifth/sixth year; consequently, one quarter therein comprises 14 weeks. We find evidence of predictable stock returns and forecast errors in 14-week quarters, which suggests that investors and analysts do not, on average, adjust their expectations for the extra week. The ease with which 14-week quarters can be predicted, and expectations adjusted, suggests a surprising lack of effort on the part of investors and analysts.

Keywords: analysts, market efficiency, fiscal year

JEL Classification: G14, G17, M4

Suggested Citation: Suggested Citation

Johnston, Rick M. and Leone, Andrew J. and Ramnath, Sundaresh and Yang, Ya-Wen, 14-Week Quarters (August 28, 2009). Available at SSRN: https://ssrn.com/abstract=1463646 or http://dx.doi.org/10.2139/ssrn.1463646