TAILIEUCHUNG - EARNINGS AND STOCK SPLITS IN THE EIGHTIES

We also frequently found that even the best corrective lenses did not improve vi- sual acuity of the impaired eye to that of the fellow eye. Through the analysis of these initial cases, an apparently predomi- nant common characteristic of these pa- tients was a work station with papers angled to the right or to the left of themon- itor and keyboard. Other reports revealed the screen was in the frontal position, but was twisted. Still others reported that their habitual work pattern was with their eyes/head twisted. Evans 23 indicated that proper func- tioning of binocular vision without symp- toms depends on: i) the anatomy of ocular structures, ii) the motor system, and iii) the sensory system through. | Journal Of Financial And Strategic Decisions Volume 10 Number 2 Summer 1997 EARNINGS AND STOCK SPLITS IN THE EIGHTIES Eugene Pilotte Abstract Prior literature presents evidence on the nature of the earnings information conveyed by stock splits during 1970-1980. During 1970-1980 the information conveyed is that large pre-split earnings increases usually viewed by the market as transitory and likely to be followed by earnings decreases are in fact permanent. This paper presents evidence on the nature of the earnings information conveyed by splits during 1982-1989 a period of lower inflation and higher real economic growth. Results for 1982-1989 indicate that the market interprets stock splits as signals of subsequent earnings increases. Thus the information conveyed by stock splits is time-period specific with the market interpreting splits more optimistically during the period when economic conditions are stronger. INTRODUCTION Results of numerous studies are consistent with the idea that stock splits signal earnings Asquith Healy and Palepu 2 hereafter AHP present evidence on the nature of the earnings information conveyed. They find that the price response to splits is positively related to pre-split but not post-split earnings changes. Thus they conclude that the earnings information conveyed by stock splits is not about subsequent earnings increases. Rather the information conveyed is that recent large earnings increases usually viewed by the market as transitory and likely to be followed by earnings decreases are in fact permanent. AHP s results give the impression that the good news conveyed by stock splits is relatively weak in that splits signal the ability to maintain rather than improve upon current earnings performance. However their findings are not suprising given the economic climate that prevailed during the 1970-1980 period from which their sample is drawn. 1970-1980 was a period of high inflation and low real economic growth with .

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• measures suggest
• surprising given
• Asymptotic Expansion
• Homogenisation and Multiscale
• Topology Optimisation
• Composite Structures
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