Valuation Implications of Investment Opportunities and Earnings Permanence

被引：1

作者：

Jones J.P. ^{[1
]}

Morton R.M. ^{[2
]}

Schaefer T.F. ^{[3
]}

机构：

[1] Auburn University, School of Accountancy, 301 Lowder Business Building, Auburn

[2] Florida State University, Department of Accounting, College of Business, Tallahassee

[3] University of Notre Dame, Department of Accountancy, 102 College of Business Building, Notre Dame

来源：

Review of Quantitative Finance and Accounting | 2000年 / 15卷 / 1期

关键词：

Earnings permanence; Investment opportunities;

D O I：

10.1023/A:1008309619839

中图分类号：

学科分类号：

摘要：

This study investigates the value-relevance of accounting earnings in the presence of investment (growth) opportunities after making two theoretical and methodological research design refinements. First, we test for the incremental effect of growth on firms' earnings response coefficients after controlling for the extent of transitory earnings under the assumption that the value-relevance of earnings with respect to growth should be stronger when earnings are more permanent. Second, we perform comprehensive factor analysis using market-based and accounting-based measures to construct a composite proxy for investment opportunities. We find that firms' investment opportunities and the relative permanence of current earnings affect the value-relevance of those earnings. Additionally, we find that the interaction between permanent earnings and investment opportunities produces an even stronger price response to earnings. © 2000 Kluwer Academic Publishers.

引用

页码：21 / 35

页数：14

共 50 条

[31] A discussion of 'Assessing the relative informativeness and permanence of pro forma earnings and GAAP operating earnings'
Bradshaw, MT
[J]. JOURNAL OF ACCOUNTING & ECONOMICS, 2003, 36 (1-3): : 321 - 335
[32] THE EUROPEAN EMISSION TRADING SCHEME: IMPLICATIONS FOR LONG-TERM INVESTMENT VALUATION
Abadie, Luis M.
Galarraga, Ibon
[J]. CLIMATE CHANGE ECONOMICS, 2011, 2 (02) : 129 - 148
[33] Accounting information, capital investment decisions, and equity valuation: Theory and empirical implications
Zhang, GC
[J]. JOURNAL OF ACCOUNTING RESEARCH, 2000, 38 (02) : 271 - 295
[34] On the relevance of earnings components in valuation and forecasting
Wang P.
[J]. Review of Quantitative Finance and Accounting, 2014, 42 (3) : 399 - 413
[35] Operational flexibility and market valuation of earnings
Tang, CY
Tikoo, S
[J]. STRATEGIC MANAGEMENT JOURNAL, 1999, 20 (08) : 749 - 761
[36] On the valuation of the arbitrage opportunities
Kouaissah, Noureddine
Lozza, Sergio Ortobelli
[J]. FINANCIAL MANAGEMENT OF FIRMS AND FINANCIAL INSTITUTIONS: 10TH INTERNATIONAL SCIENTIFIC CONFERENCE, PTS I-IV, 2015, : 582 - 589
[37] Implications of components of income excluded from pro forma earnings for future profitability and equity valuation
Landsman, Wayne R.
Miller, Bruce L.
Yeh, Shu
[J]. JOURNAL OF BUSINESS FINANCE & ACCOUNTING, 2007, 34 (3-4) : 650 - 675
[38] Valuation of R&D Investment Opportunities with the Threat of Competitors Entry in Real Option Analysis
Villani, Giovanni
[J]. COMPUTATIONAL ECONOMICS, 2014, 43 (03) : 331 - 355
[39] Valuation of R&D Investment Opportunities with the Threat of Competitors Entry in Real Option Analysis
Giovanni Villani
[J]. Computational Economics, 2014, 43 : 331 - 355
[40] Investment Analysts' Forecasts of Earnings
Ciciretti, Rocco
Dwyer, Gerald P.
Hasan, Iftekhar
[J]. FEDERAL RESERVE BANK OF ST LOUIS REVIEW, 2009, 91 (05): : 545 - 567

← 1 2 3 4 5 →