Targeted Communication and Investor Attention

In the spirit of Merton (1987) we find that targeted communication by firms raises investor attention. Continental European firms using English-language commercial press wires to disseminate corporate press releases exhibit less drift and more trading volume after their earnings announcements than firms that do not, consistent with communication on English speaking wires raising investor attention. Continental European firms using English-language commercial press wires also receive more press coverage from the English-language business press, and attract more foreign institutional investors. Our results are robust to self-selectionand other endogeneity concerns. Our findings are consistent with the idea that a targeted communication strategy helps firms improve recognition from investors.