We examine six accounting-based stock price anomalies using two sets of tests to determine the extent to which the anomalies (a) represent market mispricing, or (b) reflect premia for unidentified risks. Market mispricing is indicated if the anomalous returns are concentrated around subsequent...

Prior empirical research has typically found a difference between fourth-quarter and interim earnings, both in terms of the accuracy of earnings forecasts and the stock price response evoked. However, a differential stock price response to fourth-quarter earnings could be due to a variety of...

This paper tests whether the US stock market is myopic, in the sense that it places less than the appropriate weight on expected long-run earnings. The tests are made possible through reliance on a valuation model used by Ohlson [1995] that permits us, using only minimal assumptions, to make...

We test whether the US stock market is myopic in the sense of overvaluing short term earnings and undervaluing long term earnings (see, e.g., Porter [1992;1993]. Our tests rely on an accounting-based valuation model that generates predictions about how prices should relate to expected future...

What incentives do managers face that might give rise to inefficient investments in leases? If managers make inefficient investments in leases, what economic consequences arise for those managers and their firms? We develop a model of expected investments in leased assets and use the residuals...