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Author : Torben Voetmann
Publisher :
ISBN 13 : 9788759381151
Total Pages : 218 pages
Book Rating : 4.3/5 (811 download)
Download or read book Corporate Decisions and Capital Market Reactions written by Torben Voetmann and published by . This book was released on 2000 with total page 218 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Su Han Chan
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (129 download)
Download or read book Stock Market Reaction to Capital Investment Decisions written by Su Han Chan and published by . This book was released on 2000 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: We investigate the stock market reaction to 447 announcements of business relocation decisions in the 1978-1990 period. We find that the stock market reaction to such decisions is tied to the motive for the relocation and the implied prospects for the firm, with the type of facility being relocated playing an insignificant role. Our finding reconciles several results in the literature concerning the stock market reaction to announcements of capital investment decisions.
Author : Randall Morck
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (13 download)
Download or read book A Cross-Sectional Analysis of the Stock Market's Reaction to Corporate Investment Decisions written by Randall Morck and published by . This book was released on 2013 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper investigates the systematic variation of stock price reactions to corporate capital budget announcements. We first use an event study methodology to measure the market's reaction to capital investment announcements. These reactions are then regressed upon measures of agency problems and measures of intangible assets. We find that, on average, the market's reaction to both capital budget increases and decreases is statistically insignificant. We also find that there is support for the idea that agency problems affect the market's valuation of investment decisions. Furthermore, there is support for the hypothesis of managerial entrenchment. We also find support for the notion that investment decisions made by managers with strong reputations are more highly valued than those made by other managers. We find no support for the notions that the stock market is myopic or that managers behave myopically. There is also no support for the idea that firms with high levels of cash flow invest inefficiently.
Author : Guido Eilenberger
Publisher : Springer Science & Business Media
ISBN 13 : 3642041132
Total Pages : 129 pages
Book Rating : 4.6/5 (42 download)
Download or read book Current Challenges for Corporate Finance written by Guido Eilenberger and published by Springer Science & Business Media. This book was released on 2009-09-21 with total page 129 pages. Available in PDF, EPUB and Kindle. Book excerpt: Strategic corporate finance? This sounds like a paradox at first. After all, corporate finance means responding to the financial markets. Strategy, on the other hand, aims to change and shape the environment in the long term. Lately, though, more and more managers and investors appear to be breaking the laws of the capital market. At the same time, corporations are discovering new ways to not just react to the capital markets, but to actively shape them. The authors show that these violations are not isolated occurrences, but part of a paradigm shift. If companies want to stay successful in changing markets, they have to take a strategic approach to corporate finance. The authors use practical examples to demonstrate how this can be achieved. This book is intended not only for corporate finance experts, but also for students interested in the latest developments on the financial markets.
Author : Su Han Chan
Publisher :
ISBN 13 :
Total Pages : 31 pages
Book Rating : 4.:/5 (299 download)
Download or read book Stock-market Reaction to Capital Investment Decisions written by Su Han Chan and published by . This book was released on 1992 with total page 31 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Lisa Silge
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (15 download)
Download or read book Capital Market Reactions to Management Decisions written by Lisa Silge and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Michael Cahill
Publisher : Pearson UK
ISBN 13 : 0273759973
Total Pages : 355 pages
Book Rating : 4.2/5 (737 download)
Download or read book The Financial Times Guide to Making the Right Investment Decisions written by Michael Cahill and published by Pearson UK. This book was released on 2013-02-14 with total page 355 pages. Available in PDF, EPUB and Kindle. Book excerpt: Do you want to feel more confident about your investment decisions? Do you need to have a better understanding of how the stock markets value a business? Do you want to know what the key ratios are that drive share price performance? The Financial Times Guide to Making the Right Investment Decisions is the insider’s guide to how the market examines companies and values shares. It helps you understand the factors that drive long term wealth creation as well as highlighting the key risks that lead to value being destroyed. Originally published as Analysing Companies and Valuing Shares, this new edition has been fully revised and includes a new and easy to follow framework for understanding valuation. Perfect for investors at all levels, it guides you through the investment maze, and highlights the key issues you need to consider to invest successfully. The Financial Times Guide to Making the Right Investment Decisions: · Gives you an easy to follow framework to guide your decision-making · Explains clearly and concisely key financial concepts and how they drive valuation · Shows you the key ratios to monitor and how they affect share prices · Illustrates the key risks and warning signals that will help you avoid losses · Identifies the qualities of company management and governance that differentiates winners from losers · Brings the issues and numbers to life with real examples and case studies In a challenging economic and stock market environment, the need to take better informed decisions is vital. This clear, common sense guide provides a comprehensive and accessible framework for understanding the valuation of a business and what drives its share price. Knowing the key numbers, ratios and techniques that professional investors use will help you to reduce your risk and invest more profitably.
Author : Srinivasan Suresh
Publisher :
ISBN 13 :
Total Pages : 12 pages
Book Rating : 4.:/5 (129 download)
Download or read book Stock Market Reaction to Corporate Strategic Decisions written by Srinivasan Suresh and published by . This book was released on 2006 with total page 12 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper, we have studied the stock market's impact to public announcement of strategic decisions of Indian companies. We have used the event study methodology to assess whether there is an increase in firm value surrounding the days of such public announcements. The corporate strategic announcements include proposed acquisitions, merger announcements, joint venture creations, alliance formations and capital expenditure and Ramp;D expenditure intents. We have further analyzed the strategic announcements into different categories and have tried to capture the effects of size of announcement, the term of the announcement, whether the announcement relates to strategic activities within the country or outside the country and whether the announcement relates to 'Government' owned or 'Privately' owned companies. The results indicate that the stock market reacts negatively to public announcements of corporate strategic decisions.
Author : Stefanie Häfele
Publisher :
ISBN 13 :
Total Pages : 50 pages
Book Rating : 4.:/5 (13 download)
Download or read book Consequences of Error Announcements on Industry Peers written by Stefanie Häfele and published by . This book was released on 2015 with total page 50 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper analyzes the reactions of investors and management to an error announcement within an industry. We investigate capital market reactions as well as changes in the financial reporting decisions for a sample of CDAX®-listed industry peers to error firms in Germany. We find that peers suffer on average negative cumulative abnormal returns of -0.92% within the five day event window. More precisely, we show the contagion effect for the German setting by analyzing industry peers to error firms with negative abnormal returns. This finding can be interpreted as a loss of investors' confidence in the reliability of financial reporting within the respective industry. As a consequence of the error announcement, all industry peers might have incentives to regain reputation. Therefore, we also examine whether industry peers change the transparency of financial reporting after the event. Our results reveal that industry peers present more informative financial reporting as measured by more timely loss recognition after the error announcements. Nevertheless, we find no evidence for an increase in the preciseness of forecast reporting caused by the event. Supplemental tests reveal no significant increase in auditor turnover after an industry peer's error announcement, suggesting that industry peers do not penalize their auditors after the stock price decline.
Author : Lingfeng Wang (M.Fin.)
Publisher :
ISBN 13 :
Total Pages : 28 pages
Book Rating : 4.:/5 (98 download)
Download or read book Capital Market Reaction to Corporate Restructuring Announcements written by Lingfeng Wang (M.Fin.) and published by . This book was released on 2014 with total page 28 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Agnieszka Perepeczo
Publisher :
ISBN 13 :
Total Pages : 12 pages
Book Rating : 4.:/5 (13 download)
Download or read book Shareholders' Preferences, Business Cycles and Market Reactions to Dividend Announcements in Public Companies - Empirical Evidence written by Agnieszka Perepeczo and published by . This book was released on 2015 with total page 12 pages. Available in PDF, EPUB and Kindle. Book excerpt: The effect of corporate decisions concerning the profit distribution on market value of a company has been addressed by numerous empirical studies. Observations carried out in developed markets show that dividend initiation decisions result in an increase of abnormal returns. The main objective of this paper is to present results of shareholders' reaction to dividend initiation decisions and an impact of market cycles on the Warsaw Stock Exchange (WSE). At the beginning, a review of similar studies is carried out. Next, the sample selection and methodology were discussed. The shareholders' reactions for the whole sample were positive but abnormal returns under two models were different in the event window (-60, 60) and not homogeneous. In the case of over 45% of dividend initiations the reaction was negative. Moreover, the author have indicated that observed market business cycles may influence shareholders' reactions and abnormal returns.
Author : Jennifer Francis
Publisher : Now Publishers Inc
ISBN 13 : 1601981147
Total Pages : 97 pages
Book Rating : 4.6/5 (19 download)
Download or read book Earnings Quality written by Jennifer Francis and published by Now Publishers Inc. This book was released on 2008 with total page 97 pages. Available in PDF, EPUB and Kindle. Book excerpt: This review lays out a research perspective on earnings quality. We provide an overview of alternative definitions and measures of earnings quality and a discussion of research design choices encountered in earnings quality research. Throughout, we focus on a capital markets setting, as opposed, for example, to a contracting or stewardship setting. Our reason for this choice stems from the view that the capital market uses of accounting information are fundamental, in the sense of providing a basis for other uses, such as stewardship. Because resource allocations are ex ante decisions while contracting/stewardship assessments are ex post evaluations of outcomes, evidence on whether, how and to what degree earnings quality influences capital market resource allocation decisions is fundamental to understanding why and how accounting matters to investors and others, including those charged with stewardship responsibilities. Demonstrating a link between earnings quality and, for example, the costs of equity and debt capital implies a basic economic role in capital allocation decisions for accounting information; this role has only recently been documented in the accounting literature. We focus on how the precision of financial information in capturing one or more underlying valuation-relevant constructs affects the assessment and use of that information by capital market participants. We emphasize that the choice of constructs to be measured is typically contextual. Our main focus is on the precision of earnings, which we view as a summary indicator of the overall quality of financial reporting. Our intent in discussing research that evaluates the capital market effects of earnings quality is both to stimulate further research in this area and to encourage research on related topics, including, for example, the role of earnings quality in contracting and stewardship.
Author : H. Kent Baker
Publisher : John Wiley & Sons
ISBN 13 : 0470569522
Total Pages : 516 pages
Book Rating : 4.4/5 (75 download)
Download or read book Capital Structure and Corporate Financing Decisions written by H. Kent Baker and published by John Wiley & Sons. This book was released on 2011-05-03 with total page 516 pages. Available in PDF, EPUB and Kindle. Book excerpt: A comprehensive guide to making better capital structure and corporate financing decisions in today's dynamic business environment Given the dramatic changes that have recently occurred in the economy, the topic of capital structure and corporate financing decisions is critically important. The fact is that firms need to constantly revisit their portfolio of debt, equity, and hybrid securities to finance assets, operations, and future growth. Capital Structure and Corporate Financing Decisions provides an in-depth examination of critical capital structure topics, including discussions of basic capital structure components, key theories and practices, and practical application in an increasingly complex corporate world. Throughout, the book emphasizes how a sound capital structure simultaneously minimizes the firm's cost of capital and maximizes the value to shareholders. Offers a strategic focus that allows you to understand how financing decisions relates to a firm's overall corporate policy Consists of contributed chapters from both academics and experienced professionals, offering a variety of perspectives and a rich interplay of ideas Contains information from survey research describing actual financial practices of firms This valuable resource takes a practical approach to capital structure by discussing why various theories make sense and how firms use them to solve problems and create wealth. In the wake of the recent financial crisis, the insights found here are essential to excelling in today's volatile business environment.
Author : Agnieszka Perepeczo
Publisher :
ISBN 13 :
Total Pages : 14 pages
Book Rating : 4.:/5 (13 download)
Download or read book Market Reactions to Dividend Announcements in Public Companies - Empirical Evidence written by Agnieszka Perepeczo and published by . This book was released on 2015 with total page 14 pages. Available in PDF, EPUB and Kindle. Book excerpt: The effects of the decisions concerning the distribution of profits on market value of a company have been addressed by numerous empirical studies. At the beginning of the paper the author presents the main assumptions of complex and usually contradictory dividend policy theories as well as the clientele effect and the signalling effect strictly related to the dividend policy. Next, an overview is provided of studies analysing how shareholders respond to changes in the dividend policy, which represents the market evaluation of the event's impact on the company's value in developed markets. In order to identify similarities among the reactions of various shareholders and the impact of the decisions related to dividend policies in the Polish capital market on the market value, a statistical analysis of the scale of the distribution of profit has been carried out among companies listed on the Warsaw Stock Exchange and the results are provided along with the results of research into the reaction of shareholders to dividend initiation.
Author : Mikhail Pevzner
Publisher :
ISBN 13 :
Total Pages : 72 pages
Book Rating : 4.:/5 (13 download)
Download or read book When Firms Talk, Do Investors Listen? The Role of Trust in Stock Market Reactions to Corporate Earnings Announcements written by Mikhail Pevzner and published by . This book was released on 2015 with total page 72 pages. Available in PDF, EPUB and Kindle. Book excerpt: We examine whether the level of trust in a country affects investors' perception and utilization of information transmitted by firms through financial disclosure. Specifically, we investigate the effect of societal trust on investor reactions to corporate earnings announcements. We test two competing hypotheses: on the one hand, corporate earnings announcements are perceived as more credible by investors in more trusting societies and therefore elicit stronger investor reactions; on the other hand, societal trust mitigates outside investors' concern of moral hazard and reduces the value of corporate earnings announcements to them, thereby weakening their reactions to these events. We analyze the abnormal trading volume and abnormal stock return variance during the earnings announcement period in a large sample of firm-year observations across 25 countries, and find that both measures of investor reactions to earnings announcements are significantly higher in more trusting countries. We also find that the positive effect of societal trust on investor reactions to earnings news is more pronounced (1) when a country's investor protection and disclosure requirements are weaker, suggesting that trust acts as a substitute for formal institutions, (2) when a country's average education level is lower, consistent with less educated people relying more on trust in making economic decisions, and (3) when firm level information asymmetry is higher, supporting the notion that trust plays a more important role in poorer information environments.
Author : Simon Oertel
Publisher : GRIN Verlag
ISBN 13 : 3640332504
Total Pages : 63 pages
Book Rating : 4.6/5 (43 download)
Download or read book Do German Capital Markets React When Corporate Insiders Exercise Stock Options? written by Simon Oertel and published by GRIN Verlag. This book was released on 2009-05-26 with total page 63 pages. Available in PDF, EPUB and Kindle. Book excerpt: Diploma Thesis from the year 2007 in the subject Business economics - Business Management, Corporate Governance, grade: 1,7, University of Tubingen, language: English, abstract: Trading by corporate insiders in their company’s stock and the impact of insider trading on capital markets has long been a field of interest for academics as well as policy makers and regulators who aim to guarantee the effectiveness and fairness of capital markets. Outside investors are following corporate insiders’ trading behavior closely and might intend to mimic their trading strategies, trying to realize abnormal profits. Newspapers and information services regularly report insider trading activity.3 The term insider trading will generally be used to describe trading by corporate insiders. It does,however, not necessarily imply illegal behavior. Corporate insiders might trade for a multitude of reasons which do not have to include the illegal exploitation of inside information. The definition of corporate insiders might differ from country to country and their corresponding regulations. The differences in the definition of corporate insiders between the US, the UK, and Germany will later be explained.The academia has provided a multitude of papers on insider trading over different decades (e.g., Jaffe (1974), Seyhun (1986), Rozeff and Zaman (1998), and Lakonishok and Lee (2001)) and research has been conducted to analyze the effects of insider trading on different countries’ capital markets (e.g., Jeng et al. (2003) for the US, Fidrmuc et al. (2006) for the UK, Eckbo and Smith (1998) for Norway, and Betzer and Theissen (2005) for Germany). The majority of research publications, however, excludes stock option exercises from the analysis. The reasons for the exclusion of stock options are versatile. Early papers on insider trading exclude the exercises due to the complexity of identifying reasons for the exercise of stock options4 or the difficulty of getting price information associated with option exercises.5 Rozeff and Zaman (1998), Jeng et al. (2003), and Fidrmuc et al. (2006) do not give any specific reasons but exclude stock options from their sample as well. Other studies retain the sale of the shares in their sample when stock options are exercised and the acquired shares are sold immediately.6 Nonetheless, a new strand of literature has emerged that specifically focuses on the exercise of stock options by corporate insiders. Carpenter and Remmers (2001) pioneer in this field with their research on inside information related to the decisions by corporate insiders to exercise their stock options.
Author : Emanuele Bajo
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (129 download)
Download or read book The Stock Market Reaction to Investment Decisions written by Emanuele Bajo and published by . This book was released on 2010 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Based on a study of new investment announcements from 1989 to 1995 by Italian firms listed on the Milan Stock Exchange, we find a positive stock price reaction to new investment decisions. The stock price reaction is larger for joint venture announcements. The market response is also larger for non-state owned companies and when the announcement is released in a period of rising stock prices. The announced investment has no impact on the non-voting shares but increases the voting shares' market price through a significant revaluation of their vote-segment. We find some evidence that new investments lead to management's private benefits rather than towards firm value. This is consistent with the typical Italian corporate governance structure, where a majority shareholder safely controls a listed company while having only a fractional claim on the firm's cash flows.
