Earnings Seasonality Effect on Stock Returns in the Nordic Market

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School of Business | Bachelor's thesis
Electronic archive copy is available locally at the Harald Herlin Learning Centre. The staff of Aalto University has access to the electronic bachelor's theses by logging into Aaltodoc with their personal Aalto user ID. Read more about the availability of the bachelor's theses.

Authors

Date

2020

Department

Rahoituksen laitos

Major/Subject

Mcode

Degree programme

Rahoitus

Language

en

Pages

24 + 25

Series

Abstract

This thesis examines the earnings seasonality effect on stock returns in the Nordic market. The thesis shows that firms exhibiting a strong seasonal earnings pattern seem to deliver abnormal returns after the high-season quarter earnings announcement. The abnormal returns cannot be explained by a mere earnings announcement premium. Literature review and examination of market expectations reveal that the investors may underestimate the earnings seasonality, and thus also underestimate the high-season earnings. Literature attributes this investor bias to availability heuristics and recency effect.

Description

Thesis advisor

Ungeheuer, Michael

Keywords

Earnings seasonality, Abnormal returns, Earnings announcements, Investor biases

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Citation

Permanent link to this item

https://urn.fi/URN:NBN:fi:aalto-2020120656101

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[kand] Kauppakorkeakoulu / BIZ