This paper investigates whether and how financial restatements affect the market for corporate control. We show that firms that recently filed financial restatements are significantly less likely to become takeover targets than a propensity score matched sample of non-restating firms. For those restating firms that do receive takeover bids, the bids are more likely to be withdrawn or take longer to complete than those made to non-restating firms. Finally, there is some evidence that deal value multiples are significantly lower for restating targets than for non-restating targets. Our analyses suggest that the information risk associated with restating firms is the main driver of these results. Overall, this study finds that financial restatements have profound consequences for the allocation of economic resources in the market for corporate control. JEL Classifications: D82; G14; G34; M41. Data Availability: Data are available from sources identified in the paper.

We show that managers increase the volume of public financial guidance in response to decreases in analyst coverage of their firms, particularly to decreases that are driven by exogenous reduction in brokerage firm size. Managers do not respond to increases in analyst coverage. The managerial guidance response to decreases in coverage reflects the trade-off between the marginal benefits from analyst coverage and the marginal costs of providing guidance. Specifically, the response is concentrated within firms engaging in equity issuance activities, firms with low stock liquidity, and firms with low current guidance levels. The response is also concentrated within firms whose remaining analyst pool is smaller in number and/or has a lower percentage of analysts who are positive about the firm or who belong to a large brokerage house. Overall, our results shed insights on the interaction between managers and analysts and on how the value of analysts, as perceived by managers, varies in the cross-section with underlying firm and analyst characteristics. Data Availability: All data used in this study are publicly available from sources identified in the text.

On October 23, 2000, the SEC implemented Regulation FD (Fair Disclosure), which prohibits firms from privately disclosing value-relevant information to select securities markets professionals without simultaneously disclosing the same information to the public. We examine whether Regulation FD's prohibition of selective disclosure impairs the flow of financial information to the capital markets prior to earnings announcements. After implementation of FD, we find (1) improved informational efficiency of stock prices prior to earnings announcements, as evidenced by smaller deviations between pre-and post-announcement stock prices; (2) no reliable evidence of change in analysts' earnings forecast errors or dispersion; and (3) a substantial increase in the volume of firms' voluntary, forward-looking, earnings-related disclosures. Overall, we find no evidence Regulation FD impaired the information available to investors prior to earnings announcements, and some of our evidence is consistent with improvement.