The Impact of Profit Warnings on Stock Prices in Kuwaiti Firms

Abdullah Alajmi and Mahammad Alfaraj

International Business Research, 2022, vol. 15, issue 6, 28

Abstract: This research explores the link concerning informativeness regarding stock price and warnings pertaining to profit in organisations operating in Kuwait as an emerging country. An extensive set of panel data were utilised by the researchers, where such data linked to profit warnings percentages and stock price synchronicity on the Stock Exchange of Kuwait for the years 2010 through to 2020. Multi-regression was chosen to be applied as a parametric test, which provided the ability to garner more robust findings that are seen to be aligned with our belief that, as opposed to common market data. The findings present a wealth of insight concerning the effects of earnings declarations when it comes to stock prices and data content. The approach and assessment of profit warnings presented in this work might also provide further support for researchers seeking to carry out other stock price and profit warnings researches in emerging economics, particularly when considering that support in this regard is seen to be lacking in emerging regions. It is the view of the researchers that the present work is one of very few centres on developing regions, especially those in the GCC (Gulf Cooperation Council). Furthermore, adding to regression corporate governance factors as moderating variables has also been recognised as being far more valuable when compared with other regressions.

Date: 2022
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