Saturday, 27 March 2010: 09:40
This study examines the impact of disaggregated earnings on stock prices for international listed shipping firms. The testing period is from 2000 to 2008. The methodologies are those of panel cointegration and panel causality tests. The empirical findings show that both types of earnings are positively related to stock prices, contrary to the belief that the non-operating component contains little information. The implications are very crucial, since managers may manipulate annual earnings by these non-operating activities.