14-Week quarters

Rick Johnston

doi:10.1016/j.jacceco.2011.06.003

14-Week quarters

2012-02-01

12

PRE

AI

DOI：10.1016/j.jacceco.2011.06.003

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Abstract

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Many firms define their fiscal quarters as 13-week periods so that each fiscal year contains 52 weeks, which leaves out one or two day(s) a year. To compensate, one extra week is added every fifth or sixth year and, consequently, one quarter therein comprises 14 weeks. We find evidence of predictable forecast errors and stock returns in 14-week quarters, suggesting that analysts and investors do not, on average, adjust their expectations for the extra week. The ease with which 14-week quarters can be predicted, and expectations adjusted, suggests a surprising lack of effort on the part of analysts and investors. (C) 2011 Elsevier B.V. All rights reserved.

Keywords:

Analysts

Market efficiency

Fiscal year

14-Week quarters

Abstract

Journal

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