Dissertations, Theses, and Capstone Projects
Date of Degree
6-2024
Document Type
Dissertation
Degree Name
Ph.D.
Program
Business
Advisor
Carol Marquardt
Committee Members
Kalin Kolev
Karl Lang
Diana Weng
Subject Categories
Accounting
Keywords
non-GAAP, voluntary disclosure, social media, retail investor, stock trading
Abstract
The SEC has long been concerned about the impact of non-GAAP earnings on investors’ perceptions of firms, particularly retail investors. This concern is amplified by the surging number of retail investors in recent years, a trend likely fueled by greater access to brokerage firms, commission-free trading, and investment-related content on social media. In this paper, I investigate social media as an alternative information channel that facilitate the dissemination of non-GAAP earnings news for retail investors. Despite years of regulatory and media scrutiny, the association between non-GAAP earnings surprises and retail trades is positive and even stronger for firms with higher social media attention. The results are robust after controlling for firms’ information environment and traditional media coverage. Notably, both dissemination Tweets and original Tweets contribute to this effect. Moreover, I demonstrate that retail investors prefer non-GAAP signals and trade against social media opinion, contradicting the “wisdom of the crowds.”
Recommended Citation
Do, Huy Nguyen, "The Effects of Social Media Attention on Retail Investors’ Non-GAAP Trading" (2024). CUNY Academic Works.
https://academicworks.cuny.edu/gc_etds/5747
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