Non-Earnings Conference Calls: Content, Determinants, and Consequences

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2018-05

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Abstract

I use computational linguistic techniques to study the content, determinants, and stock market consequences of conference calls that are not held in conjunction with quarterly earnings releases (hereafter, non-earnings conference calls). I find that loss firms, growth firms, and firms with complex operations and a greater number of analysts following hold more both non-earnings and earnings conference calls. However, large firms and firms with more volatile earnings hold relatively more non-earnings conference calls than earnings conference calls. Firms with volatile earnings and greater operational complexity discuss more about earnings and investment-related topics in non-earnings conference calls. These results are consistent with the notion that firms facing greater informational problems hold more non-earnings conference calls. I also find that, controlling for other disclosure types, non-earnings conference calls incrementally explain quarterly abnormal stock returns, suggesting that they indeed help improve firms’ information environment.

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Keywords

Non-earnings conference call, Textual analysis, Voluntary disclosures, Information environment

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