Earnings Conference Call Content and Stock Price: The Case of REITs

Posted: 28 Aug 2012

See all articles by James Doran

James Doran

University of New South Wales

David R. Peterson

Florida State University - Department of Finance

S. McKay Price

Lehigh University - Perella Department of Finance

Multiple version iconThere are 2 versions of this paper

Date Written: August 28, 2012

Abstract

Using computer based content analysis, we quantify the linguistic tone of quarterly earnings conference calls for publicly traded Real Estate Investment Trusts (REITs). After controlling for the earnings announcement, we examine the relation between conference call tone and the contemporaneous stock price reaction. We find that the tone of the conference call dialogue has significant explanatory power for the abnormal returns at and immediately following quarterly earnings announcements. The question and answer portion of the conference calls dominates prepared managerial introductory remarks in explanatory significance. Furthermore, an overall positive tone in the conference call discussion between management and analysts is found to nearly offset the damaging effects of a negative earnings surprise.

Keywords: REITs, Conference calls, Content analysis, Tone

Suggested Citation

Doran, James and Peterson, David R. and Price, S. McKay, Earnings Conference Call Content and Stock Price: The Case of REITs (August 28, 2012). Journal of Real Estate Finance and Economics, Vol. 45, No. 2, 2012, Available at SSRN: https://ssrn.com/abstract=2137820

James Doran

University of New South Wales ( email )

College Rd
Sydney, NSW 2052
Australia

David R. Peterson

Florida State University - Department of Finance ( email )

Tallahassee, FL 32306-1042
United States
850-644-8200 (Phone)
850-644-4225 (Fax)

S. McKay Price (Contact Author)

Lehigh University - Perella Department of Finance ( email )

621 Taylor Street
Bethlehem, PA 18015
United States
610-758-4787 (Phone)

HOME PAGE: http://www.mckayprice.com

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