Beyond the street EPS surprise – when ‘other surprises’ matter in explaining earnings announcement returns

Pawel Bilinski

Accounting and Business Research, 2025, vol. 55, issue 7, 780-811

Abstract: This study examines when accounting surprises other than the street EPS surprise, i.e. ‘other surprises’, are useful to investors. First, ‘other surprises’ are incrementally important when companies use earnings management to beat the analyst consensus EPS forecasts and when earnings quality is low. Second, ‘other surprises’ are useful in interpreting quarterly results for (i) growth stocks, (ii) stocks with high institutional ownership (particularly by active institutions and blockholders), and (iii) in interpreting the quality of the street EPS surprise. Third, the street EPS surprise shows no association with earnings announcement returns controlling for ‘other surprises.’ This result reflects that some ‘other surprises’, such as the net income surprise, are better predictors of future earnings surprises than the street EPS surprise.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/00014788.2024.2400875 (text/html)
Access to full text is restricted to subscribers.

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:taf:acctbr:v:55:y:2025:i:7:p:780-811

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RABR20

DOI: 10.1080/00014788.2024.2400875

Access Statistics for this article

Accounting and Business Research is currently edited by Vivien Beattie

More articles in Accounting and Business Research from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().