Do Firms Strategically Use Non-Earnings Press Releases

Jiwon Hyeon, Hyunkwon Cho and Joonil Lee

Finance Research Letters, 2024, vol. 63, issue C

Abstract: This study examines the strategic use of non-earnings press releases (NEPR) by firms experiencing poor financial performances. Utilizing a dataset from Naver.com, we classify news originating from press releases by applying deep-learning techniques and find that firms issue more NEPR in the fourth quarter following poor performance in the first three quarters. Market reactions to NEPR vary based on previous performance, suggesting investors recognize firms' strategic intention of these releases. This study emphasizes the need for market participants to assess the motives behind NEPR, especially from poor performing firms.

Keywords: Non-earnings press release; Disclosure; Market response; Strategic behavior; Fourth quarter reporting (search for similar items in EconPapers)
JEL-codes: G14 M37 M41 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:63:y:2024:i:c:s1544612324002885

DOI: 10.1016/j.frl.2024.105258

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