Earnings and Dividend Announcements is there a Corroboration Effect?

Alex Kane, Young Ki Lee and Alan Marcus

No 1248, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We examine abnormal stock returns surrounding contemporaneous earnings and dividend announcements in order to determine whether investors evaluate the two announcements in relation to each other.We find that there is a statistically significant interaction effect.The abnormal return corresponding to any earnings or dividend announcement depends upon the value of the other announcement. This evidence suggests the existence of a corroborative relationship between the two announcements. Investors give more credence to unanticipated dividend increases or decreases when earnings are also above or below expectations, and vice versa.

Date: 1983-12
Note: ME
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Citations: View citations in EconPapers (3)

Published as Kane, Alex, Young Ki Lee, and Alan J. Marcus. "Earnings and Dividend Announcements: Is There a Corroboration Effect?" Journal of Finance, Vol. 39, No. 4, (September 1984), pp. 1091-1099.

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Journal Article: Earnings and Dividend Announcements: Is There a Corroboration Effect? (1984)
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