Researchers - Nathan Marshall (University of Colorado at Boulder), Jackie Wegner (University of Southern California) and Sarah Zechman (University of Colorado at Boulder) - have published a study on whether companies use social media to communicate market-relevant information directly to investors.
They found evidence indicating that “corporate tweets often function as a distinct disclosure channel”.
Based on a sample of 4.4m tweets posted by S&P 1500 firms during trading hours between 2007 and 2022, the study assessed the timing of the social media posts and whether they were associated with market responses.
A large portion of tweets occurred on days without concurrent earning announcements or regulatory filings, while intraday trading reactions around tweets were found to be “economically meaningful”.
The study summary reads: “Surprisingly, despite the apparent capital-market relevance of tweets, few firms explicitly designate Twitter as a disclosure channel in regulatory filings."
“Moreover, we find no evidence that investor responses increase, or that tweet content changes, following either formal designation or informal mention of Twitter in these filings,” it concludes. “This disconnect points to a potential gap between how firms appear to use social media and regulatory expectations for recognised disclosure channels.”