Presenter: Laura Reese Kurt

Faculty Sponsor: Emily Wang

School: UMass Amherst

Research Area: Finance

Session: Poster Session 5, 3:15 PM - 4:00 PM, Concourse, B16

ABSTRACT

This research project examines whether investors assign a valuation premium, or higher price, to companies that emphasize artificial intelligence in their corporate filings, and whether that premium reflects broad market “AI hype” or firm and industry specific hype. I am using a hand-collected panel of 109 firms from 2020 - 2024 and a small preliminary sample of 16 firms that have released their 2025 annual filings. I measure AI disclosure intensity as the annual count of AI-related actionable mentions in “Item 1: Business” of 10-K filings. I run multiple regressions to estimate the association between Tobin’s Q (market value of a company / total replacement cost of assets), a metric indicating whether a firm is under- or overvalued, and AI mentions, controlling for profitability and firm size. The initial results indicate that an “AI valuation premium” exists across the market, specifically in the tech industry. In the small 2020-2025 subset, increases in AI mentions are statistically significantly positively associated with higher next year Tobin’s Q. To assess whether this is due to the restricted sample size, once data from 2020 - 2025 for all 109 firms is available, robustness checks will be conducted with comparable regression models using the updated sample.