The Strategic Timing of Corporate Disclosures

An important element of a firm's disclosure strategy is the timing of its mandatory public announcements. In this paper, two aspects of disclosure timing are examined. The first is the intraday timing of earnings announcements. It is demonstrated here that, under reasonable conditions, market prices reflect better the valuation implications of an earnings announcement when it is made during trading hours rather than after the market has closed. This implies that managers should prefer to release earnings with positive (negative) implications for firm value during (after) trading hours. The second issue examined is the sequencing of multiple corporate disclosures. It is shown that if the announcements have positive (negative) implications for firm value, managers should prefer to make them separately (simultaneously), as market prices better reflect the valuation implications of multiple announcements when they are made at different times