Accrued Earnings and Growth: Implications for Future Profitability and Market Mispricing

By P. Fairfield, J. Whisenant, Teri Lombardi Yohn. 2003

748 citations recorded by the source corpus.

Subfields: Accounting, Finance, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/25b013b5474a17bbadf6fca23379901de09df71b

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Citations in the corpus

On the Scope and Drivers of the Asset Growth Effect (2011, neutral): “1Representative papers include Fairfield, Whisenant, and Yohn (2003), Titman, Wei, and Xie (2004), Broussard, Michayluk, and Neely (2005), Anderson and Garcia-Feijóo (2006), Lyandres, Sun, and Zhang (2008), Xing (2008), Cooper, Gulen, and Schill (2008), and Polk and Sapienza (2009).”
Asset Growth and the Cross-Section of Stock Returns (2008, neutral): “3 Fairfield, Whisenant, and Yohn (2003) find that accrual effects are a subset of a larger anomaly with respect to a general market mispricing of growth in net operating assets.”
Accruals and price crashes (2016, background): “9 The lower persistence of accruals may also be explained by firm growth (Fairfield et al. 2003).”
The Use of Dupont Analysis by Market Participants (2008, neutral): “Fairfield et al. (2003b) argue that ΔNOA is a proxy for growth find and that it subsumes the operating accrual anomaly proposed by Sloan (1996).”
The Association Between Management Earnings Forecast Errors and Accruals (2009, background): “…3 Prior research on accrual anomaly largely concurs that the accrual-based hedge portfolio returns reflect investors’ inefficient processing of accruals information (e.g., Sloan 1996; Bradshaw et al. 2001; Collins et al. 2003; Fairfield et al. 2003).”
Understanding Earnings Quality: A Review of the Proxies, Their Determinants and Their Consequences (2010, background): “14 Richardson et al. (2006), however, point out that while Fairfield et al. (2003a) measure growth at the firm level, the Stigler (1963, p. 54) reference to the role of diminishing returns is made at the industry level.”
Short Arbitrage, Return Asymmetry, and the Accrual Anomaly (2011, neutral): “…negative predictors of future returns, as are various accrual components (e.g. operating, investing, and financing accruals; Richardson, Sloan, Soliman, and Tuna 2005), and more inclusive variables that contain accruals (Fairfield, Whisenant, and Yohn 2003; Hirshleifer, Hou, Teoh, and Zhang 2004).”
Accruals, Investment, and the Accrual Anomaly (2007, neutral): “Alternatively, Fairfield et al. (2003) interpret accruals as growth in short-term net operating assets and argue that the accrual anomaly is a special case of a more general anomaly based on growth in net operating assets.”
Do Investors Overvalue Firms With Bloated Balance Sheets (2004, neutral): “The independent variables are either: (1) the excess return of the market portfolio (proxied by the value-weighted CRSP portfolio), (2) the Fama and French (1995) three factor model, which contains the market excess returns and returns on two factor-mimicking portfolios associated with the size effe”
... and the Cross-Section of Expected Returns (2013, neutral): “12 Examples of the publication of unsuccessful factors include Fama and MacBeth (1973) and Ferson and Harvey (1993). Fama and MacBeth (1973) show that squared beta and standard deviation of the market model residual have an insignificant role in explaining the cross-section of expected returns.”
Accrual Reversals, Earnings and Stock Returns (2013, neutral): “In contrast, Fairfield et al. (2003) and Wu et al. (2010) hypothesize that it is attributable to diminishing marginal returns to new investment.”
The Cross Section of Expected Stock Returns (2014, background): “Stock issuance: Many studies find that equity sales and repurchases have predictive power for future returns over both the short and long run (see Fama (1998), for a review).”