While the earnings season is in full swing, valuation expert Aswath Damodaran argued against quarterly earnings reporting, saying that such frequent announcements, in reality, lead to less information being passed on to investors due to a phenomenon he called "disclosure diarrhoea".
While market regulators around the globe call for more transparency, the 'Dean of Valuation' believes that there is nothing inherently good about having more disclosures. In his long blog post, Damodaran noted that most stock market investors in the US and other parts of the world spend their investing lifetimes in an environment where companies not only release full financial statements every quarter, but do so with huge fanfare. He highlighted that these quarterly earnings reports have bulked up in size over time, undercutting their usefulness.
