Essays on fundamental analysis

Efficient capital allocation is essential to a well-functioning economy, as it enables value-creating firms to access the resources they need to innovate, expand operations, and create jobs. In turn, these outcomes lead to a prosperous society. To allocate capital efficiently, investors engage in fundamental analysis, the process of forecasting a firm's performance to estimate its value. Financial statements play a central role in this process by providing comparable, reliable, and timely information about a company’s current performance. This dissertation examines whether specific features of accounting information are useful for company valuation, and if so, whether capital providers use this information efficiently when deciding to buy, sell, or hold a company's securities.