Social media analysts, managerial learning, and corporate innovation

We study the role of non-traditional investment research as a source of information for managerial learning and corporate investment decisions. Using a comprehensive sample of social media analyst reports from Seeking Alpha and exogenous variation in social media analysts' coverage overlaps, we show that firms are more likely to invest into technologies similar to firms covered by the same analyst. The effect is incremental to coverage by professional sell-side analysts and varies with social media analysts' characteristics and differences in their contributed content that capture their unique information set. Overall, our results are consistent with non-traditional investment research enhancing firms' information environment as an additional source of information that may guide corporate investment decisions.