The Strategic Timing of Management Forecasts

41 Pages Posted: 29 Sep 2009 Last revised: 7 Jul 2015

See all articles by Jeffrey T. Doyle

Jeffrey T. Doyle

Utah State University

Matthew J. Magilke

Claremont McKenna College - Robert Day School of Economics and Finance

Date Written: June 30, 2015

Abstract

In this study, we examine the strategic intraday and intraweek timing of management forecast announcements based on whether they contain good or bad news. In contrast to past research using highly visible earnings announcements, unscheduled voluntary management forecasts provide a setting in which there may be greater benefits to strategic announcement timing. We find strong evidence that bad news tends to be strategically released after the market closes and on Fridays. In addition, we find evidence that strategically timed bad news forecast announcements that are released after the market closes are associated with less negative market returns, less trading volume, and less market volatility. Thus, our results suggest that the strategic timing of bad news forecasts during times of lower investor attention is successful at mitigating negative market reactions.

Keywords: management forecasts, strategic disclosure, investor inattention

JEL Classification: M41

Suggested Citation

Doyle, Jeffrey T. and Magilke, Matthew J., The Strategic Timing of Management Forecasts (June 30, 2015). Available at SSRN: https://ssrn.com/abstract=1479867 or http://dx.doi.org/10.2139/ssrn.1479867

Jeffrey T. Doyle (Contact Author)

Utah State University ( email )

College of Business
Logan, UT 84322-3540
United States

Matthew J. Magilke

Claremont McKenna College - Robert Day School of Economics and Finance ( email )

500 E. Ninth St.
Claremont, CA 91711-6420
United States

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