Skip to Main Content
HBS Home
  • About
  • Academic Programs
  • Alumni
  • Faculty & Research
  • Baker Library
  • Giving
  • Harvard Business Review
  • Initiatives
  • News
  • Recruit
  • Map / Directions
Faculty & Research
  • Faculty
  • Research
  • Featured Topics
  • Academic Units
  • …→
  • Harvard Business School→
  • Faculty & Research→
Publications
Publications
  • November 2020
  • Article
  • Management Science

Casting Conference Calls

By: Lauren Cohen, Dong Lou and Christopher J. Malloy
  • Format:Print
ShareBar

Abstract

We explore a subtle but important mechanism through which firms can control information flow to the markets. We find that firms that “cast” their conference calls by disproportionately calling on bullish analysts tend to underperform in the future. Firms that call on more favorable analysts experience more negative future earnings surprises and more future earnings restatements. A long-short portfolio that exploits this differential firm behavior earns abnormal returns of up to 149 basis points per month or almost 18 percent per year. We find similar evidence in an international sample of earnings call transcripts from the UK, Canada, France, and Japan. Firms with higher discretionary accruals, firms that barely meet/exceed earnings expectations, and firms (and their executives) that are about to issue equity, sell shares, and exercise options, are all significantly more likely to cast their earnings calls.

Keywords

Strategic Release; Firms; Conference Calls; Information; Strategy; Asset Pricing

Citation

Cohen, Lauren, Dong Lou, and Christopher J. Malloy. "Casting Conference Calls." Management Science 66, no. 11 (November 2020): 5015–5039. (Winner of the First Prize, Crowell Memorial Award for Best Paper in Quantitative Investments, PanAgora Asset Management, 2014.)
  • SSRN
  • Find it at Harvard

About The Author

Lauren H. Cohen

Finance
→More Publications

More from the Authors

    • February 2023
    • Faculty Research

    All Options on the Table: The Haber Family

    By: Lauren Cohen, Grace Headinger and Juan Ruiz
    • January 2023
    • Faculty Research

    Baofeng's Philanthropic Efforts in China

    By: Lauren Cohen, Hao Gao, Bo Li and Zhaoheng Gong
    • 2023
    • Faculty Research

    Too Many Managers: The Strategic Use of Titles to Avoid Overtime Payments

    By: Lauren Cohen, Umit Gurun and N. Bugra Ozel
More from the Authors
  • All Options on the Table: The Haber Family By: Lauren Cohen, Grace Headinger and Juan Ruiz
  • Baofeng's Philanthropic Efforts in China By: Lauren Cohen, Hao Gao, Bo Li and Zhaoheng Gong
  • Too Many Managers: The Strategic Use of Titles to Avoid Overtime Payments By: Lauren Cohen, Umit Gurun and N. Bugra Ozel
ǁ
Campus Map
Harvard Business School
Soldiers Field
Boston, MA 02163
→Map & Directions
→More Contact Information
  • Make a Gift
  • Site Map
  • Jobs
  • Harvard University
  • Trademarks
  • Policies
  • Accessibility
  • Digital Accessibility
Copyright © President & Fellows of Harvard College