Presenter: Arman Eshraghi, Cardiff University

Title: Investor Technophilia: Market Reactions to Disclosure of Emerging Technologies

Abstract: We examine how investors react when firms disclose hyped emerging technologies. In a novel US setting, we match technologies disclosed in 8-K filings with corresponding stages of the widely used Gartner Hype Cycle. Findings show strong robust evidence for ‘technology hype’: investor short-term reactions are significantly positive - particularly to technologies at their peak of inflated expectations - but reverse later due to insider selling and firms overselling the hype. Firms with low analyst coverage, high retail ownership and information asymmetry, and those outside Nasdaq and the Silicon Valley experience stronger abnormal returns, consistent with investors searching for ‘hidden gems’.

Host: Tom Aabo

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