Within-industry timing of earnings warnings: do managers herd?

• 成果类型: Article
• 署名作者: Tse, Senyo; Tucker, Jennifer Wu
• 署名单位: Texas A&M University System; Texas A&M University College Station; Mays Business School; State University System of Florida; University of Florida
• 刊物名称: REVIEW OF ACCOUNTING STUDIES
• ISSN/ISSBN: 1380-6653
• DOI: 10.1007/s11142-009-9117-4
• 发表日期: 2010
• 页码: 879-914
• 关键词: INTRAINDUSTRY INFORMATION TRANSFERS; stock-based compensation; SHAREHOLDER LITIGATION; DISCLOSURE POLICY; strategic delay; MARKET; INVESTMENT; forecasts; BEHAVIOR; performance

摘要

An earnings surprise can be caused by a combination of firm-specific factors and market or industry factors. We hypothesize that managers have an incentive to time their warnings to occur soon after their industry peers' warnings to minimize their apparent responsibility for earnings shortfalls. Using duration analysis, we find that firms accelerate their warnings in response to peer firms' warnings. We conduct several tests to control for alternative explanations for warning clustering (for example, common shocks and information transfer) and conclude that the observed clustering is primarily due to herding. Our study is one of the first to empirically examine managers' herding behavior and the first to document clustering of bad news. Moreover, we provide a multi-firm perspective on managers' disclosure decisions that alerts researchers to consider or control for herding when they examine other determinants of managers' disclosure decisions.