Earnings communication conferences and post-earnings-announcement drift: Evidence from China

Earnings communication conferences in China have become the main platform for direct communication between listed firms and individual investors. This study investigates whether hosting an earnings communication conference and its tone affect post-earnings-announcement drift (PEAD). We find that hosting an earnings communication conference increases PEAD. One possible explanation for our results is that investors overreact to the stock prices of firms that hold earnings communication conferences. We also conclude that the conference tone is negatively correlated with PEAD. In addition, the market reacts more strongly to the managers’ tone than it does to the investor's tone.