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  November 2002 Volume 32 Number 4
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Managerial Actions, Stock Returns, and Earnings: The Case of Business-to-Business Internet Firms
Shivaram Rajgopal, Mohan Venkatachalam, and Suresh Kotha
Journal of Accounting Research
vol. 40, no. 2 (May 2002):529556

Summarized by William H. Sackley, CFA

Typical financial variables, such as earnings announcements, gross margins, marketing, and R&D expenses, provide limited assistance for valuing business-to-business (B2B) Internet companies. The announcement of various managerial actions, however, does offer information to the market, as witnessed by increases in stock price volatility around the announcement and the announcement's ability to explain more long-run market returns than traditional financial variables can. At least in the B2B industry, nonfinancial actions can serve as leading indicators of future stock market performance.

Topical Index Keywords

Equity Investments
Fundamental Analysis and Valuation Models

Shivaram Rajgopal and Suresh Kotha are at the University of Washington.
More articles by Shivaram Rajgopal.
More articles by Suresh Kotha.

Mohan Venkatachalam is at Stanford University.
More articles by Mohan Venkatachalam.

Summarized by William H. Sackley, CFA, University of North Carolina at Wilmington.

 


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