Market (In)Attention and the Strategic Scheduling and Timing of Earnings Announcements

48 Pages Posted: 7 Jan 2015 Last revised: 18 Sep 2015

See all articles by Ed deHaan

Ed deHaan

University of Washington - Michael G. Foster School of Business

Terry J. Shevlin

University of California-Irvine

Jacob R. Thornock

Brigham Young University

Date Written: March 3, 2015

Abstract

We investigate whether managers “hide” bad news by announcing earnings during periods of low attention, or by providing less forewarning of an upcoming earnings announcement. Our findings are consistent with managers reporting bad news after market hours, on busy days, and with less advance notice, and with earnings receiving less attention in these settings. Paradoxically, our findings indicate that managers also report bad news on Fridays, but we do not find lower attention on Fridays. Further, we find negative returns when the market is notified of an upcoming Friday earnings announcement, which is consistent with investors inferring forthcoming bad news.

Keywords: Market attention, earnings announcement timing, earnings announcement scheduling, earnings announcement notifications, strategic disclosure

JEL Classification: L20, M10, M41

Suggested Citation

deHaan, Ed and Shevlin, Terry J. and Thornock, Jacob, Market (In)Attention and the Strategic Scheduling and Timing of Earnings Announcements (March 3, 2015). Journal of Accounting and Economics, Volume 60, Issue 1, August 2015, Pages 36–55; Rock Center for Corporate Governance at Stanford University Working Paper No. 201; Stanford University Graduate School of Business Research Paper No. 15-8. Available at SSRN: https://ssrn.com/abstract=2545966 or http://dx.doi.org/10.2139/ssrn.2545966

Ed DeHaan (Contact Author)

University of Washington - Michael G. Foster School of Business ( email )

Box 353200
Seattle, WA 98195-3200
United States

Terry J. Shevlin

University of California-Irvine ( email )

Irvine, CA California 92697-3125
United States
2065509891 (Phone)

Jacob Thornock

Brigham Young University ( email )

Provo, UT 84602
United States
8014220828 (Phone)

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