Prior research found that Residual Income (RI) is, at best, minimally informative about stock returns relative to Earnings, despite strong support for RI in theory and among practitioners. We examine three possible explanations for this puzzle. First, the empirical literature ignores some salient feature of practice or theory. Second, the market does not fully impound all of the information fro...

From 1994 to 1998, Bradshaw (2004) finds that analysts’ stock recommendations relate negatively to residual income valuation estimates but positively to valuation heuristics based on the price-to-earnings-to-growth ratio and long-term growth. These results are surprising, especially considering that future returns relate positively to residual income valuation estimates and negatively to heuris...

Background: Malignant disorder with B or T stem cell basis leads to development and continuation of acute lymphoblastic leukemia (ALL) due to aggregation of blast cells in bone marrow. The environmental, genetic, and demographic factors may influence the disease relapse. The objective of this study was to assess the relation between end of induction minimal residual disease and different risk f...

Prior research found that residual income (RI) is not as informative about stock returns as net income (NI), despite theory that demonstrates the role of residual income in valuation and a long history support for RI among practitioners. We replicate these tests and find similar results. We then consider an alternate perspective of viewing NI and RI not as competing measures in a horse race, bu...

In this paper, we use the definition of residual income to develop a framework that decomposes changes in net income into different components. The two components we focus on are the change in net income driven by investment (investment-driven growth), and the change in net income driven by improvements in the productivity of existing assets (productivity-driven growth). Building on the vast li...

Substantive income effects are incorporated in a logit or nested-logit model by assuming that utility is a piece-wise linear spline function of residual income. Specific income data are not required, only income by category. Expected compensating variation is easily and accurately approximated by the difference between expected maximum utility in the proposed and initial state, multiplied by th...