The Native Earnings Effect Hypothesis as a Derivation of the Market Overreaction
This research intends to analyze the existence of Negative Earnings Effect on the Jakarta Stock Exchange. The Negative Earnings Effect Hypothesis (NEEH) says that firms which announce negative Earnings per share (EPS) on their financial statement at the end of the year, will recover their condition...
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| Format: | Article |
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[Yogyakarta] : Universitas Gadjah Mada
2001
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| _version_ | 1797018162131107840 |
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| author | Perpustakaan UGM, i-lib |
| author_facet | Perpustakaan UGM, i-lib |
| author_sort | Perpustakaan UGM, i-lib |
| collection | UGM |
| description | This research intends to analyze the existence of Negative Earnings Effect on the Jakarta Stock Exchange. The Negative Earnings Effect Hypothesis (NEEH) says that firms which announce negative Earnings per share (EPS) on their financial statement at the end of the year, will recover their condition and return to profitable operations and will be able to produce significantly large, positive abnormal returns front their stocks in the subsequent year.
The NEEH also argues that these firms reporting negative earnings will, in the year after the announcement, outperform firms reporting positive earnings by making larger earnings (EPS) changes. The NEEH argues that due to the loss announcement, the market does not anticipate this recovery possibility and misses a big investment opportunity. The NEEH posits that by simply buying a loss-firm's stock, one will earn a larger positive abnormal return in the following year.
Keywords: abnormal returns |
| first_indexed | 2024-03-13T18:40:00Z |
| format | Article |
| id | oai:generic.eprints.org:20124 |
| institution | Universiti Gadjah Mada |
| last_indexed | 2024-03-13T18:40:00Z |
| publishDate | 2001 |
| publisher | [Yogyakarta] : Universitas Gadjah Mada |
| record_format | dspace |
| spelling | oai:generic.eprints.org:201242014-06-18T00:32:56Z https://repository.ugm.ac.id/20124/ The Native Earnings Effect Hypothesis as a Derivation of the Market Overreaction Perpustakaan UGM, i-lib Jurnal i-lib UGM This research intends to analyze the existence of Negative Earnings Effect on the Jakarta Stock Exchange. The Negative Earnings Effect Hypothesis (NEEH) says that firms which announce negative Earnings per share (EPS) on their financial statement at the end of the year, will recover their condition and return to profitable operations and will be able to produce significantly large, positive abnormal returns front their stocks in the subsequent year. The NEEH also argues that these firms reporting negative earnings will, in the year after the announcement, outperform firms reporting positive earnings by making larger earnings (EPS) changes. The NEEH argues that due to the loss announcement, the market does not anticipate this recovery possibility and misses a big investment opportunity. The NEEH posits that by simply buying a loss-firm's stock, one will earn a larger positive abnormal return in the following year. Keywords: abnormal returns [Yogyakarta] : Universitas Gadjah Mada 2001 Article NonPeerReviewed Perpustakaan UGM, i-lib (2001) The Native Earnings Effect Hypothesis as a Derivation of the Market Overreaction. Jurnal i-lib UGM. http://i-lib.ugm.ac.id/jurnal/download.php?dataId=2969 |
| spellingShingle | Jurnal i-lib UGM Perpustakaan UGM, i-lib The Native Earnings Effect Hypothesis as a Derivation of the Market Overreaction |
| title | The Native Earnings Effect Hypothesis as a Derivation of the Market Overreaction |
| title_full | The Native Earnings Effect Hypothesis as a Derivation of the Market Overreaction |
| title_fullStr | The Native Earnings Effect Hypothesis as a Derivation of the Market Overreaction |
| title_full_unstemmed | The Native Earnings Effect Hypothesis as a Derivation of the Market Overreaction |
| title_short | The Native Earnings Effect Hypothesis as a Derivation of the Market Overreaction |
| title_sort | native earnings effect hypothesis as a derivation of the market overreaction |
| topic | Jurnal i-lib UGM |
| work_keys_str_mv | AT perpustakaanugmilib thenativeearningseffecthypothesisasaderivationofthemarketoverreaction AT perpustakaanugmilib nativeearningseffecthypothesisasaderivationofthemarketoverreaction |