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Table 7 Alternative explanation

From: The capital market spillover effect of product market advertising: Evidence from stock price synchronicity

Variable Earning = Operating incomeEarning = Net income
Ri,tRi,tRi,tRi,t
(1)(2)(3)(4)
Adi,t × Earningsi,t + 126.911a (2.81)28.748a (3.08)22.910a (2.83)19.164b (2.37)
Earningsi,t-1−1.550a (−8.40)−1.202a (−6.66)−1.385a (−8.78)−0.958a (−5.92)
Earningsi,t1.252a (5.90)1.457a (6.87)0.951a (5.05)1.193a (5.85)
Earningsi,t + 10.872a (4.97)1.022a (5.82)0.843a (5.33)0.788a (4.80)
Ri,t + 1−0.130a (−7.98)−0.129a (−8.08)−0.130a (−8.03)−0.125a (−7.26)
Adi,t−0.215 (−0.78)−0.362 (−1.37)−0.276 (−1.10)−0.373 (−1.46)
Adi,t × Earningsi,t-1−16.988b (−2.12)−16.037b (−2.02)−14.822b (−2.02)−13.887c (−1.86)
Adi,t × Earningsi,t−4.856 (−0.48)−3.339 (−0.33)−3.382 (−0.37)3.144 (0.33)
Adi,t × Ri,t + 10.165 (0.28)0.170 (0.29)0.113 (0.19)−0.338 (−0.56)
Size −0.046a (−5.82) −0.041a (−5.86)
Debt 0.210a (5.48) 0.196a (5.11)
Bm −0.027a (−3.84) −0.028a (−4.13)
Growth 0.004 (0.43) 0.005 (0.48)
Coverage −0.008 (−1.37) −0.015b (−2.57)
_Cons0.081 (1.00)0.948a (5.39)0.105 (1.36)0.824a (5.54)
Year fixed effectsYesYesYesYes
Industry fixed effectsYesYesYesYes
No. of obs.5,0945,0945,0945,094
Adj. R20.1140.1300.1150.071
  1. Notes. The independent variable of columns (1) and (2) is operating income for firm i at fiscal year-end. Column (2) shows the results with the inclusion of control variables on the basis of column (1). The independent variable of columns (3) and (4) is net income for firm i at fiscal year-end. Column (4) shows the results with the inclusion of control variables on the basis of column (3). Numbers in parentheses are t-statistics based on standard errors clustered by firm when we control for year and industry effects
  2. a, b, and c denote statistical significance at the 1%, 5%, and 10% levels, respectively