TY - JOUR
T1 - Are investors influenced by how earnings press releases are written?
AU - Henry, Elaine
PY - 2008/10
Y1 - 2008/10
N2 - This two-part study begins with a rhetorical analysis of the genre of earnings press releases. Then, a quantitative analysis uses capital markets data to assess the investor impact of tone and other stylistic attributes. The genre analysis explores the regulatory context, structural attributes, and dual informational-promotional role of earnings press releases, using individual releases as illustrations. The quantitative analysis explores the relation between the stock market reaction to earnings press releases and quantitative measures of style developed using elementary computer-based content analysis of a corpus of releases. Results suggest that tone influences investors' reactions. An explanation for this result is provided by prospect theory, which predicts that framing financial performance in positive terms causes investors to think about the results in terms of increases relative to reference points. Results also suggest that longer press releases reduce the market impact of unexpected earnings.
AB - This two-part study begins with a rhetorical analysis of the genre of earnings press releases. Then, a quantitative analysis uses capital markets data to assess the investor impact of tone and other stylistic attributes. The genre analysis explores the regulatory context, structural attributes, and dual informational-promotional role of earnings press releases, using individual releases as illustrations. The quantitative analysis explores the relation between the stock market reaction to earnings press releases and quantitative measures of style developed using elementary computer-based content analysis of a corpus of releases. Results suggest that tone influences investors' reactions. An explanation for this result is provided by prospect theory, which predicts that framing financial performance in positive terms causes investors to think about the results in terms of increases relative to reference points. Results also suggest that longer press releases reduce the market impact of unexpected earnings.
KW - Content analysis
KW - Earnings announcements
KW - Event study
KW - Investor communications
KW - Tone
UR - http://www.scopus.com/inward/record.url?scp=51049103207&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=51049103207&partnerID=8YFLogxK
U2 - 10.1177/0021943608319388
DO - 10.1177/0021943608319388
M3 - Article
AN - SCOPUS:51049103207
SN - 0021-9436
VL - 45
SP - 363
EP - 407
JO - Journal of Business Communication
JF - Journal of Business Communication
IS - 4
ER -