{"id":"https://openalex.org/W2174587010","doi":"https://doi.org/10.2469/faj.v51.n4.1917","title":"Overreaction, Underreaction, and the Low-P/E Effect","display_name":"Overreaction, Underreaction, and the Low-P/E Effect","publication_year":1995,"publication_date":"1995-07-01","ids":{"openalex":"https://openalex.org/W2174587010","doi":"https://doi.org/10.2469/faj.v51.n4.1917","mag":"2174587010"},"language":"en","primary_location":{"id":"doi:10.2469/faj.v51.n4.1917","doi":"https://doi.org/10.2469/faj.v51.n4.1917","is_oa":false,"landing_page_url":"https://doi.org/10.2469/faj.v51.n4.1917","pdf_url":null,"source":{"id":"https://openalex.org/S162525099","display_name":"Financial Analysts Journal","issn_l":"0015-198X","issn":["0015-198X","1938-3312"],"is_oa":false,"is_in_doaj":false,"is_core":true,"listed_in":["abdc-a","anvur-class-a","anvur-scientific","cwts-core","fnege-2","jufo-1","norway-1","poland-100","russia-white-list-1","vabb-shw"],"host_organization":"https://openalex.org/P4310320547","host_organization_name":"Taylor & Francis","host_organization_lineage":["https://openalex.org/P4310320547","https://openalex.org/P4310320449"],"host_organization_lineage_names":["Taylor & Francis","Informa"],"type":"journal"},"license":null,"license_id":null,"version":"publishedVersion","is_accepted":true,"is_published":true,"raw_source_name":"Financial Analysts Journal","raw_type":"journal-article"},"volume":null,"type":"article","indexed_in":["crossref"],"open_access":{"is_oa":false,"oa_status":"closed","oa_url":null,"any_repository_has_fulltext":false},"authorships":[{"author_position":"first","author":{"id":"https://openalex.org/A5056597850","display_name":"David N. Dreman","orcid":null,"observed_orcids":[]},"institutions":[],"countries":[],"is_corresponding":false,"raw_author_name":"David N. Dreman","raw_affiliation_strings":["David N. Dreman is chairman of Dreman Value Management L.P"],"raw_orcid":null,"affiliations":[{"raw_affiliation_string":"David N. Dreman is chairman of Dreman Value Management L.P","institution_ids":[]}]},{"author_position":"last","author":{"id":"https://openalex.org/A5112663464","display_name":"Michael A. Berry","orcid":null,"observed_orcids":[]},"institutions":[{"id":"https://openalex.org/I11883440","display_name":"James Madison University","ror":"https://ror.org/028pmsz77","country_code":"US","type":"education","lineage":["https://openalex.org/I11883440"]}],"countries":["US"],"is_corresponding":false,"raw_author_name":"Michael A. Berry","raw_affiliation_strings":["Michael A. Berry is Wheat First Professor of Investments at James Madison University"],"raw_orcid":null,"affiliations":[{"raw_affiliation_string":"Michael A. Berry is Wheat First Professor of Investments at James Madison University","institution_ids":["https://openalex.org/I11883440"]}]}],"institutions":[],"countries_distinct_count":1,"institutions_distinct_count":1,"corresponding_author_ids":[],"corresponding_institution_ids":[],"apc_list":null,"apc_paid":null,"fwci":2.4962,"has_fulltext":false,"cited_by_count":132,"citation_normalized_percentile":{"value":0.91399068,"is_in_top_1_percent":false,"is_in_top_10_percent":true},"cited_by_percentile_year":{"min":89,"max":99},"biblio":{"volume":"51","issue":"4","first_page":"21","last_page":"30"},"is_retracted":false,"is_paratext":false,"is_xpac":false,"primary_topic":{"id":"https://openalex.org/T10047","display_name":"Financial Markets and Investment Strategies","score":1.0,"subfield":{"id":"https://openalex.org/subfields/2003","display_name":"Finance"},"field":{"id":"https://openalex.org/fields/20","display_name":"Economics, Econometrics and Finance"},"domain":{"id":"https://openalex.org/domains/2","display_name":"Social Sciences"}},"topics":[{"id":"https://openalex.org/T10047","display_name":"Financial Markets and Investment Strategies","score":1.0,"subfield":{"id":"https://openalex.org/subfields/2003","display_name":"Finance"},"field":{"id":"https://openalex.org/fields/20","display_name":"Economics, Econometrics and Finance"},"domain":{"id":"https://openalex.org/domains/2","display_name":"Social Sciences"}},{"id":"https://openalex.org/T12123","display_name":"Financial Analysis and Corporate Governance","score":9.999999747378752e-05,"subfield":{"id":"https://openalex.org/subfields/1402","display_name":"Accounting"},"field":{"id":"https://openalex.org/fields/14","display_name":"Business, Management and Accounting"},"domain":{"id":"https://openalex.org/domains/2","display_name":"Social Sciences"}},{"id":"https://openalex.org/T10081","display_name":"Auditing, Earnings Management, Governance","score":0.0,"subfield":{"id":"https://openalex.org/subfields/1402","display_name":"Accounting"},"field":{"id":"https://openalex.org/fields/14","display_name":"Business, Management and Accounting"},"domain":{"id":"https://openalex.org/domains/2","display_name":"Social Sciences"}}],"keywords":[{"id":"https://openalex.org/keywords/contrarian-strategy","display_name":"contrarian strategy","score":0.6019999980926514},{"id":"https://openalex.org/keywords/earnings-surprises","display_name":"earnings surprises","score":0.800000011920929},{"id":"https://openalex.org/keywords/overreaction","display_name":"overreaction","score":0.8330000042915344},{"id":"https://openalex.org/keywords/underreaction","display_name":"underreaction","score":0.9940000176429749},{"id":"https://openalex.org/keywords/mispricing","display_name":"mispricing","score":0.7509999871253967},{"id":"https://openalex.org/keywords/mean-reversion","display_name":"mean reversion","score":0.7990000247955322},{"id":"https://openalex.org/keywords/stock-returns","display_name":"stock returns","score":0.7369999885559082},{"id":"https://openalex.org/keywords/price-correction","display_name":"price correction","score":0.41200000047683716}],"concepts":[{"id":"https://openalex.org/C2779652781","wikidata":"https://www.wikidata.org/wiki/Q5165738","display_name":"Contrarian","level":2,"score":0.9689747095108032},{"id":"https://openalex.org/C2778357720","wikidata":"https://www.wikidata.org/wiki/Q17147211","display_name":"Earnings surprise","level":5,"score":0.9668246507644653},{"id":"https://openalex.org/C2780343955","wikidata":"https://www.wikidata.org/wiki/Q333173","display_name":"Surprise","level":2,"score":0.7609033584594727},{"id":"https://openalex.org/C162324750","wikidata":"https://www.wikidata.org/wiki/Q8134","display_name":"Economics","level":0,"score":0.7129839062690735},{"id":"https://openalex.org/C178300618","wikidata":"https://www.wikidata.org/wiki/Q1898509","display_name":"Extant taxon","level":2,"score":0.6129137277603149},{"id":"https://openalex.org/C2781426361","wikidata":"https://www.wikidata.org/wiki/Q5326940","display_name":"Earnings","level":2,"score":0.5920901894569397},{"id":"https://openalex.org/C2779343474","wikidata":"https://www.wikidata.org/wiki/Q3109175","display_name":"Context (archaeology)","level":2,"score":0.5754204988479614},{"id":"https://openalex.org/C2985330422","wikidata":"https://www.wikidata.org/wiki/Q724931","display_name":"Market efficiency","level":2,"score":0.5473015308380127},{"id":"https://openalex.org/C29368100","wikidata":"https://www.wikidata.org/wiki/Q724931","display_name":"Efficient-market hypothesis","level":4,"score":0.5236209034919739},{"id":"https://openalex.org/C106159729","wikidata":"https://www.wikidata.org/wiki/Q2294553","display_name":"Financial economics","level":1,"score":0.4711778461933136},{"id":"https://openalex.org/C2778392974","wikidata":"https://www.wikidata.org/wiki/Q5326945","display_name":"Earnings growth","level":3,"score":0.46420225501060486},{"id":"https://openalex.org/C556758197","wikidata":"https://www.wikidata.org/wiki/Q580018","display_name":"Monetary economics","level":1,"score":0.45273321866989136},{"id":"https://openalex.org/C149782125","wikidata":"https://www.wikidata.org/wiki/Q160039","display_name":"Econometrics","level":1,"score":0.3504122793674469},{"id":"https://openalex.org/C147808555","wikidata":"https://www.wikidata.org/wiki/Q7233519","display_name":"Post-earnings-announcement drift","level":4,"score":0.2970360815525055},{"id":"https://openalex.org/C2780299701","wikidata":"https://www.wikidata.org/wiki/Q475000","display_name":"Stock market","level":3,"score":0.1640409231185913},{"id":"https://openalex.org/C206217203","wikidata":"https://www.wikidata.org/wiki/Q1134378","display_name":"Earnings per share","level":3,"score":0.07574674487113953},{"id":"https://openalex.org/C10138342","wikidata":"https://www.wikidata.org/wiki/Q43015","display_name":"Finance","level":1,"score":0.07112768292427063},{"id":"https://openalex.org/C15744967","wikidata":"https://www.wikidata.org/wiki/Q9418","display_name":"Psychology","level":0,"score":0.06233760714530945},{"id":"https://openalex.org/C151730666","wikidata":"https://www.wikidata.org/wiki/Q7205","display_name":"Paleontology","level":1,"score":0.0},{"id":"https://openalex.org/C86803240","wikidata":"https://www.wikidata.org/wiki/Q420","display_name":"Biology","level":0,"score":0.0},{"id":"https://openalex.org/C78458016","wikidata":"https://www.wikidata.org/wiki/Q840400","display_name":"Evolutionary biology","level":1,"score":0.0},{"id":"https://openalex.org/C77805123","wikidata":"https://www.wikidata.org/wiki/Q161272","display_name":"Social psychology","level":1,"score":0.0}],"mesh":[],"locations_count":1,"locations":[{"id":"doi:10.2469/faj.v51.n4.1917","doi":"https://doi.org/10.2469/faj.v51.n4.1917","is_oa":false,"landing_page_url":"https://doi.org/10.2469/faj.v51.n4.1917","pdf_url":null,"source":{"id":"https://openalex.org/S162525099","display_name":"Financial Analysts Journal","issn_l":"0015-198X","issn":["0015-198X","1938-3312"],"is_oa":false,"is_in_doaj":false,"is_core":true,"listed_in":["abdc-a","anvur-class-a","anvur-scientific","cwts-core","fnege-2","jufo-1","norway-1","poland-100","russia-white-list-1","vabb-shw"],"host_organization":"https://openalex.org/P4310320547","host_organization_name":"Taylor & Francis","host_organization_lineage":["https://openalex.org/P4310320547","https://openalex.org/P4310320449"],"host_organization_lineage_names":["Taylor & Francis","Informa"],"type":"journal"},"license":null,"license_id":null,"version":"publishedVersion","is_accepted":true,"is_published":true,"raw_source_name":"Financial Analysts Journal","raw_type":"journal-article"}],"best_oa_location":null,"sustainable_development_goals":[],"study_designs":[],"awards":[],"funders":[],"has_content":{"grobid_xml":false,"pdf":false},"content_urls":null,"referenced_works_count":11,"referenced_works":["https://openalex.org/W1493117078","https://openalex.org/W1496268815","https://openalex.org/W2024990719","https://openalex.org/W2038224101","https://openalex.org/W2061592058","https://openalex.org/W2069239969","https://openalex.org/W2080923156","https://openalex.org/W2096815396","https://openalex.org/W2144487825","https://openalex.org/W2315939576","https://openalex.org/W4237403557"],"related_works":["https://openalex.org/W1963908040","https://openalex.org/W2159962818","https://openalex.org/W1608186051","https://openalex.org/W1502974884","https://openalex.org/W2729405709","https://openalex.org/W6990576970","https://openalex.org/W2264893625","https://openalex.org/W3120234734","https://openalex.org/W1992134683","https://openalex.org/W7037456672"],"abstract_inverted_index":{"Although":[0],"earnings":[1,21],"surprises":[2,22],"have":[3,8],"been":[4,10],"studied":[5],"extensively,":[6],"they":[7],"not":[9],"examined":[11],"in":[12,30,43,114],"the":[13,41,58,61,70,83,91,104,115],"context":[14],"of":[15,57,60,107],"contrarian":[16,108],"strategies.":[17],"Positive":[18],"and":[19,26,85,112],"negative":[20],"affect":[23],"\u201cbest\u201d":[24],"(high-P/E)":[25],"\u201cworst\u201d":[27],"(low-P/E)":[28],"stocks":[29,46,52],"an":[31],"asymmetric":[32],"manner":[33],"that":[34],"favors":[35],"worst":[36,45],"stocks.":[37],"Long-term":[38],"reversion":[39],"to":[40,79,82],"mean,":[42],"which":[44],"display":[47],"above-market":[48],"returns":[49,106],"while":[50],"best":[51],"show":[53],"below-market":[54],"results,":[55],"regardless":[56],"sign":[59],"surprise,":[62,84],"continues":[63],"for":[64],"at":[65],"least":[66],"19":[67],"quarters":[68],"following":[69],"news.":[71],"These":[72],"results":[73],"are":[74],"consistent":[75,94],"with":[76,95],"mispricing":[77],"(overreaction":[78],"events)":[80],"prior":[81],"a":[86],"corrective":[87],"price":[88],"movement":[89],"after":[90],"surprise":[92],"is":[93],"extant":[96],"research":[97],"on":[98],"underreaction.":[99],"The":[100],"mispricing-correction":[101],"hypothesis":[102],"explains":[103],"superior":[105],"strategies":[109],"noted":[110],"here":[111],"elsewhere":[113],"literature.":[116]},"counts_by_year":[{"year":2025,"cited_by_count":1},{"year":2024,"cited_by_count":4},{"year":2023,"cited_by_count":5},{"year":2022,"cited_by_count":2},{"year":2021,"cited_by_count":4},{"year":2020,"cited_by_count":1},{"year":2019,"cited_by_count":2},{"year":2018,"cited_by_count":2},{"year":2017,"cited_by_count":3},{"year":2016,"cited_by_count":5},{"year":2015,"cited_by_count":6},{"year":2014,"cited_by_count":5},{"year":2013,"cited_by_count":4},{"year":2012,"cited_by_count":5}],"updated_date":"2026-10-28T10:33:24.094632","created_date":"2016-06-24T00:00:00"}