Firms’ Tweets and Stock Price Discovery

Jonathan Berkovitch, Doron Israeli, Venkat Subramanian

Research output: Working paper


Do firms’ tweets improve stock price discovery at quarterly earnings announcements? We address this question using a comprehensive sample of 148,656 tweets released by 855 S&P 1500 firms from 2008 through 2021. Firms’ tweets are associated with stronger stock price and volume reactions to earnings announcements. In addition, firms’ tweets reduce investor uncertainty, increase the timeliness and efficiency with which stock prices reflect information in earnings announcements, and reduce the post-earnings-announcement drift. We document that firms’ tweets improve stock price discovery by increasing retail investor trading, which facilitates faster incorporation of information into stock prices. Our inferences hold in a propensity score matched sample, where firms that use Twitter are matched with similar firms that do not. Our findings are of interest to regulators who wish to enhance the informativeness of security prices, investors who are interested in information that affects prices and volume, and managers who seek channels to communicate with investors.
Original languageEnglish
Publication statusIn preparation - 2023


  • Firms’ tweets
  • Stock price discovery
  • Informational efficiency of stock prices


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