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Evaluation of Annual Reports by Text Analysis: An Application in Bist100 Index

Author

Listed:
  • Sedat Çerez

    (Gebze Technical University)

  • Abdullah Kürşat Merter

    (Gebze Technical University)

  • Yavuz Selim Balcıoğlu

    (Gebze Technical University)

  • Gökhan Özer

    (Gebze Technical University)

Abstract

In this study, the annual reports of 60 non-financial firms in the Borsa Istanbul (BIST) 100 index are examined, and the topics and sentiment tone of the reports are analyzed. Using the Latent Dirichlet Allocation method, it is found that four main topics are differentiated in the annual reports, and approximately 87% of the disclosures in the reports exhibit a positive sentiment and 13% of the disclosures exhibit a negative sentiment, indicating that there is a generally optimistic tone in the reports. This research highlights the potential of text analysis as a tool for extracting meaningful insights from corporate reports and offers a new approach to understanding corporate performance and strategy.

Suggested Citation

  • Sedat Çerez & Abdullah Kürşat Merter & Yavuz Selim Balcıoğlu & Gökhan Özer, 2024. "Evaluation of Annual Reports by Text Analysis: An Application in Bist100 Index," Journal of Finance Letters (Maliye ve Finans Yazıları), Maliye ve Finans Yazıları Yayıncılık Ltd. Şti., vol. 39(121), pages 175-188, April.
    • Handle: RePEc:acc:malfin:v:39:y:2024:i:121:p:175-188
    DOI: https://doi.org/10.33203/mfy.1338486
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    More about this item

    Keywords

    Annual Reports; Text Analysis; Sentiment Analysis; Bist100;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
    • C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data; Data Access
    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods

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