Optimistic Reporting and Pessimistic Investing: Do Pro Forma Earnings Disclosures Attract Short Sellers?


  • Accepted by Mary Harris Stanford. We appreciate helpful comments from Mary Harris Stanford and two anonymous referees that significantly improved the paper. We also appreciate suggestions from Bob Bowen, Rick Mergenthaler, Kari Olsen, Mark Soliman, Ed Swanson, Jeff Wilks, David Wood, and participants at the Brigham Young University, IE Business School, Santa Clara University, and Texas A&M University workshops. We are especially grateful to Jenny Tucker for help and insights into modeling self-selection. We appreciate the valuable research assistance of Minkwan Ahn, Kris Allee, Joe Bartlett, Jeff Bednar, Dirk Black, Bryant Blanchard, Brandon Buhler, Brandon Butler, Nathan DeFries, Leo Ebbert, Jonathan Fife, Josh Gagon, Kirk Gibb, Bryan Graden, Nick Guest, Jeff Hoopes, Alicia Ingalls, Rob Jenson, Robert Judd, Chad Larson, Jon Liljegren, Sam Mautz, Derek Moody, Greg Packer, Spencer Pierce, Heidi Prescott, John Prete, Willis Pueblo, Rob Shaw, Jacob Smith, Roy Schmardebeck, Dale Stewart, Scott Tandberg, Patrick Walsh, Adam Ward, Chris Williams, Devin Williams, Ty Woods, Donnie Young, and Luke Zimmerman. Christensen expresses appreciation to Brigham Young University for student mentoring grants that made this research possible.