Many companies may be engaging in revenue management, along with earnings management, to meet or beat analyst expectations, particularly in the technology and health care industries, according to a new study.

The study, by assistant professor Rong Zhao of the University of Calgary, examined the financial data of 6,836 public companies in five major business sectors over a period of 16 ½ years. Her research found that stock prices of companies in the technology and health care sectors have almost double the sensitivity to reported revenues (known as a “revenue response coefficient,” or RRC) than stock prices of companies in other sectors have. Their stocks rise or decline twice as much as other stocks in response to the amount by which their revenues differ from what analysts had predicted.

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