In this study, we investigate the performance of firms selected to Barron's Most Respected Companies against the S&P 500 and a matched sample over a short-term, long-term and operational basis. The most respected companies exhibit a statistically significant announcement effect associated with their selection and outperform the S&P 500 over longer-holding periods. The overall sample and those firms identified as top picks outperform a matched sample of firms. In addition, as measured by changes in the return on assets, the post-selection operational performance of the most respected firms was better than that of the matched firms.
All Science Journal Classification (ASJC) codes
- Economics, Econometrics and Finance (miscellaneous)