Impact of profit warnings on share prices in Finland
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School of Business |
Bachelor's thesis
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Authors
Date
2022
Department
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Mcode
Degree programme
Rahoitus
Language
en
Pages
15 + 9
Series
Abstract
I examine both negative and positive profit warnings given in Finland between the years 2007 and 2022 and what their short-term impact on the stock price is. I also examine the differences in stock reactions between positive and negative profit warnings. This study consists of 278 negative and 185 positive profit warnings given in Finland between 1.3.2007 and 11.10.2022. I find a significant abnormal return of 6,11% for positive warnings and a significant abnormal return of -5,24% for negative warnings on the day of the announcement. I also find a statistically significant overreaction of the investors for negative profit warnings.Description
Thesis advisor
Shin, SeanKeywords
Profit warning, Market reaction, Earnings announcement, Market efficiency