EconPapers    
Economics at your fingertips  
 

The information content of real operating performance measures from the airline industry

Paul Borochin

Journal of Financial Markets, 2020, vol. 50, issue C

Abstract: I use daily passenger flight delay data for all publicly held domestic US airlines from 1996 to 2016 to answer fundamental questions about the efficiency of market participants, accounting measures, and analysts in assessing the firm's real operating performance. Airline performance is priced in the cross-section of cumulative market- and industry-adjusted returns, with significant drift. Quarterly aggregates of performance predict post-earnings announcement drift. The sensitivity of individual airline operations to those of the entire industry, measured using a beta approach, carries a negative premium consistent with systemic operating risk being a liability rather than a positively priced risk factor with implications for the accounting beta literature. Return on sales reflects the quarter's real operating performance better than other common ROA measures, contributing to the measure selection literature.

Keywords: Market efficiency; Operating performance measures; Return predictability (search for similar items in EconPapers)
JEL-codes: G12 G14 M41 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1386418119303581
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:finmar:v:50:y:2020:i:c:s1386418119303581

DOI: 10.1016/j.finmar.2019.100528

Access Statistics for this article

Journal of Financial Markets is currently edited by B. Lehmann, D. Seppi and A. Subrahmanyam

More articles in Journal of Financial Markets from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2021-06-30
Handle: RePEc:eee:finmar:v:50:y:2020:i:c:s1386418119303581