The Mispricing of Cash Flows and Accruals at Different Life-Cycle Stages

• 成果类型: Article
• 署名作者: Hribar, Paul; Yehuda, Nir
• 署名单位: University of Iowa; University of Texas System; University of Texas Dallas
• 刊物名称: CONTEMPORARY ACCOUNTING RESEARCH
• ISSN/ISSBN: 0823-9150
• DOI: 10.1111/1911-3846.12117
• 发表日期: 2015
• 页码: 1053-1072
• 关键词: stock-prices; cross-section; persistence; INVESTMENT; MARKET; earnings; performance; GROWTH; RISK

摘要

This paper employs the firm life-cycle concept to extend our understanding of the mispricing of accrual and cash flow information by the stock market. We find that accruals and free cash flows are strongly (negatively) correlated in the maturity and decline stages of a firm's life cycle but not in the growth stage, suggesting that they capture unique information in the growth stage of the firm's life cycle but more correlated information in the later stages. Consistent with this finding, we show that the cash flows anomaly subsumes the accruals anomaly in maturity and decline stages, but not in the growth stage. Our findings contribute to the debate regarding the overlap between the two anomalies.