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Trading on record-breaking monthly revenue announcements

Author

Listed:
  • Lai, Chun-Chuan
  • Tsai, Wei-Hsuan
  • Lin, Yueh-Neng
  • Lin, Anchor Y.

Abstract

This study examines market reactions to record-high monthly revenue announcements by listed firms in Taiwan using intraday trading data. We document short-term abnormal returns from short-selling at the next day’s market opening, especially among stocks with strong pre-announcement gains, high prices, and rapid revenue growth, consistent with attention-driven trading and investor overconfidence. In contrast, a buy-and-hold strategy initiated after the announcement yields significant positive returns over the subsequent 20 trading days, reflecting gradual price adjustment consistent with post-earnings announcement drift (PEAD). We further show that pre-announcement institutional net-selling intensifies short-term reversals and supports post-announcement price recovery, underscoring the joint roles of institutional trading and behavioral biases in shaping both short- and long-term price dynamics around salient revenue news.

Suggested Citation

  • Lai, Chun-Chuan & Tsai, Wei-Hsuan & Lin, Yueh-Neng & Lin, Anchor Y., 2026. "Trading on record-breaking monthly revenue announcements," Finance Research Letters, Elsevier, vol. 100(C).
    • Handle: RePEc:eee:finlet:v:100:y:2026:i:c:s154461232600440x
    DOI: 10.1016/j.frl.2026.109911
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    Keywords

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    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets

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