The Impact of Earning Quality on Excess Returns with Regard to Momentum

Tehran Stock Exchange has not lived and somewhat inefficient. Mechanisms and rules governing this market is still not implemented in such a way that the quality of data and information provided by member companies to deliver optimal.and suffered not because of pricing errors. Probably the most attention of users of financial statements, the income statement is focused on the lowest row. In the eyes of most, profit accounting tool for making logical decisions In general indicates that measures the quality of earnings on excess stock returns based on Fama and French three-factor model, taking into account the trend of stock prices of listed companies on Tehran Stock Exchange, is impressive. In this study of four indicators to measure earnings quality, earnings stability, predictability of earnings, accruals quality and smoothing was used as the four hypothesis that the effect of these measures on additional efficiency gains from the difference between the real Return expected return achieved was measured and the results of the test showed that the hypothesis were accepted theories, the literature cited in the literature and theoretical framework also matched.