The Impacts of Growth Opportunity and Information Asymmetry on Earnings Announcement

• Main Authors: Yen-Chang Chen, 陳彥昌
• Other Authors: Hsu-Huei Huang
• Format: Others
• Language: zh-TW
• Published: 2002
• Online Access: http://ndltd.ncl.edu.tw/handle/48714324294694287634

碩士 === 朝陽科技大學 === 企業管理系碩士班 === 90 === Abstract Miller and Modigliani (1961) indicate that the corporate values are composed of asset in place and growth opportunity value in the future. In the markets where have asymmetric information between the insider and outsider. Investors have to take the risk of information asymmetry especially when public announcement. Traditional variables that test the effect of earnings announcement such as earnings surprises, trading volume, and firm size, do not perform well. Different with prior researches, in order to improve the explanatory power of earnings announcement we test the growth opportunity and information asymmetry directly. This research aims to examine the effect of earnings announcement on stock prices. We also test the effect of growth opportunity, information asymmetry, firm size and insiders trading on earnings announcement. The samples of our study contain 782 events during the period 1997/1-2000/12. The empirical results can be summarized as follows： 1.Companies with negative unexpected earnings are associated with negative abnormal return. 2.Higher growth companies get better prices effect of announcement. 3.For those companies with negative unexpected earnings, higher information asymmetry is associated with worse price effect. 4.Less evidence is found to support firm size would effect earnings announcement. 5.For those companies with positive unexpected earnings, insiders trading are positively related to announcement effect.