Timing Matters in Earnings Announcements
How late earnings announcements change the signals sent across an industry.
Overview
New UIC Business research shows that when companies delay their earnings announcements—even by a few days—the information becomes less useful to the rest of the industry. The study, “Are Delayed Earnings Announcements Informative for Peer Firms?”, finds that peer firms’ stock-price movements are reduced by 24% when an early announcer reports later than expected, weakening the signal that normally spreads across the market.
“Timely reporting is part of how markets learn,” said Dr. Shailendra (Shail) Pandit, Associate Professor of Accounting and Associate Dean of Graduate Programs at UIC Business.
What the Study Examined
The research team — Dr. Somnath Das and Dr. Shail Pandit of UIC Business, along with co-author Dr. Alexander King (Ph.D. ’15, UIC) of Saint Xavier University — examined how changes in the timing of earnings announcements affect the way information spreads across firms within an industry. Their goal was to understand how delayed reporting alters the flow of market-relevant information.
To study this, the authors measured how stock prices of peer firms respond to early announcers’ earnings news — a process known as intra-industry information transfer. By connecting disclosure timing with peer-firm reactions, the study shows that delayed announcements reduce the usefulness of this information to other firms in the industry.
Earnings timing isn’t a simple scheduling choice—it determines how information flows across an industry.
— Dr. Somnath Das, Professor of Accounting, UIC Business
Key Findings
- Reduced industry signal (24% decline in peer-firm movement).
Delayed announcements lead to 24% smaller stock-price movements among peer firms, indicating diminished information transfer across the industry. - Information leakage during the delay window.
Some industry-relevant insights are released before the delayed announcement, leaving less “new” information for investors at the time of the release. - More firm-specific, less industry-wide information.
Delayed announcements emphasize information about the announcing firm rather than broader industry conditions, reducing their usefulness for peer firms and analysts.
Why It Matters
For investors: Timing carries information—delays can signal uncertainty or reduce the value of the final report.
For firms: On-time reporting strengthens transparency and supports market credibility.
For analysts: Accounting for announcement timing improves the interpretation of market reactions.
Research Impact
By shedding light on how timing affects market reactions, this work reinforces UIC Business’s role in advancing research that helps investors, analysts, and organizations navigate today’s complex financial landscape.
The study will appear in the Journal of Business Finance & Accounting, a leading peer-reviewed journal with a 12% acceptance rate and a 5-year impact factor of 3.8, underscoring the rigor and significance of this contribution to accounting and financial market research.
Read the full article here.