Sanjeev Bhorjraj, Robert Libby, and Holly Yang have a paper on SSRN titled “Analyzing Guidance at the Firm Level: The Association between Guidance Frequency, Guidance Properties, and Market Reactions.” The paper is the first to examine the relationship between the frequency and type of guidance issued by firms and the accuracy of that guidance and market reaction to it.

Compared to occasional guiders, frequent guiders issue guidance in a timelier manner and their guidance issuances are less optimistically biased, more accurate, and more precise. Controlling for the amount of news issued, we also find that the market reaction to guidance issued by frequent guiders is more positive for good news and less negative for bad news, consistent with market awareness of the differences in  guidance properties between frequent and occasional guiders. Frequent guiders also display improvements over time in guidance accuracy, bias, and timeliness, that are consistent with a better understanding of the guidance process.