How quickly do investors react to analyst reports? Evidence from reports released outside trading hours

Kotaro Miwa

Global Finance Journal, 2023, vol. 57, issue C

Abstract: This study analyzes whether the publication timing of reports released outside trading hours affects subsequent price drift to determine if investors respond immediately to analyst reports. Significant price drifts are observed for revisions in target prices, especially when a report is released within two hours before the market opens. Furthermore, the influence of publication timing is crucial when investors must process information about earnings announcements and multiple reports. Conversely, the influence is irrelevant to the visibility of reports (e.g., broker size and star analyst status). The identified limitation of investors' response is attributable to their limited information-processing capacity.

Keywords: Analyst report; Price drift; Information processing capacity; investor's inattention (search for similar items in EconPapers)
JEL-codes: G14 G24 G41 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eee:glofin:v:57:y:2023:i:c:s1044028323000510

DOI: 10.1016/j.gfj.2023.100856

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