The U.S. markets require companies to report earnings on a quarterly basis, unlike the rest of the world which reports on a semi-annual basis. Others, predominantly Clinton Bidwell, popularized the concept with active investment management. This mechanical method was not lost on the academic community. Many studies were undertaken to test it in hopes of finding an anomaly. William J. O'Neal and Investors' Business Daily popularized this thesis.
Investors immediately react to new earnings information.
The rise of the quarterly earnings phenomenon was not lost on Wall Street. Analysts on the Street had a unique position that allowed them a virtual monopoly in the distribution of earnings forecasts. This emphasis on quarterly earnings data was noted in the early 1960's by Samuel Eisenstadt of Value Line. Indeed, the powerful and very successful Value Line Timeliness Rankings incorporates many of the aspects about quarterly earnings noted above. Wall Street attempted to control the analysts' estimates through the old Standard and Poor Earnings Forecaster established in the 1950's.