The impact of prior stock market reactions on risk taking in acquisitions

2015 ◽  
Vol 36 (13) ◽  
pp. 2111-2121 ◽  
Author(s):  
M. V. Shyam Kumar ◽  
Jaya Dixit ◽  
Bill Francis
Keyword(s):  
Stock Market ◽  
Risk Taking ◽  
Market Reactions ◽  
Stock Market Reactions ◽  
The Impact

The Impact of Information Security Events on the Stock Value of Firms: The Effect of Contingency Factors

2011 ◽  
Vol 26 (1) ◽  
pp. 60-77 ◽  
Author(s):  
Ali Alper Yayla ◽  
Qing Hu
Keyword(s):  
Information Security ◽  
Stock Market ◽  
Negative Impact ◽  
Denial Of Service ◽  
Future Research ◽  
Event Analysis ◽  
Market Reactions ◽  
Security Breaches ◽  
Stock Market Reactions ◽  
The Impact

The stock market reactions to information technology (IT)-related events have often been used as proxies to the value or cost of these events in the information systems literature. In this paper, we study the stock market reactions to information-security-related events using the event analysis methodology with consideration of the effects of a number of contingency factors, including business type, industry, type of breach, event year, and length of event window. We found that pure e-commerce firms experienced higher negative market reactions than traditional bricks-and-mortar firms in the event of security breach. We also found that denial of service attacks had higher negative impact than other types of security breaches. Finally, security events occurred in recent years were found to have less significant impact than those occurred earlier, suggesting that investors may have become less sensitive to the security events. Most interestingly, our analyses showed that the magnitude and longevity of security breaches vary with time across sub-samples. This raises some serious questions regarding the validity of analyzing only short-term stock market reactions as an indicator of the cost of security breaches, and in general, an indicator of the value of IT-related events. The implications of these results are discussed and potential future research directions are proposed.

scholarly journals The impact of different types of interorganizational co-operation on shareholder value – the case of Germany

2009 ◽  
Vol 6 (4) ◽  
pp. 542-550
Author(s):  
Robert Obermaier ◽  
Andreas Busch
Keyword(s):  
Stock Market ◽  
Ad Hoc ◽  
Abnormal Returns ◽  
Market Reactions ◽  
Interorganizational Cooperation ◽  
Cooperative Agreements ◽  
German Stock ◽  
Institutional Types ◽  
Stock Market Reactions ◽  
The Impact

This event study analyses stock market reactions of 621 adhoc notifications announcing interorganizational cooperative agreements issued by stock listed German firms between 1999 and 2007. Besides testing the general relationship between ad hoc notifications of interorganizational cooperations and stock market response this study is the first one analyzing different institutional types of cooperational agreements for the German stock market. The announcement cooperational agreements results in significant positive mean abnormal returns. Surprisingly, announcements of contractual partnerships yield the highest abnormal returns compared to alternative forms combined with equity stakes. Obviously, shareholders do not necessarily relate better control of interorganizational cooperation to ownership.

Managers' sexually-oriented behavior and firm performance: linking media reports to stock market reactions and legal risk

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Amy Nicole Baker ◽  
David King ◽  
Michael Nalick ◽  
Melissa Tempio ◽  
Vishal K. Gupta ◽  
...  
Keyword(s):  
Sexual Harassment ◽  
Stock Market ◽  
Market Reaction ◽  
Market Reactions ◽  
Content Type ◽  
Stock Market Reaction ◽  
Workplace Romance ◽  
Media Reports ◽  
Stock Market Reactions ◽  
The Impact

PurposeThe goal of this study is to examine the association between managers' sexually-oriented behavior in publicly traded firms and subsequent stock market reactions. Both sexual harassment and nonharassing sexually-oriented behavior (i.e. workplace romance) are associated with negative shareholder reactions. The authors also examine factors that may alter the stock market reaction and those that may reduce the risk of lawsuit in sexual harassment cases.Design/methodology/approachInformation about incidents of sexually-oriented behavior was collected from media reports and content coded. An event study with a stock market reaction was used to measure the impact of disclosed sexually-oriented behaviors. Logistic regression was used to assess the relationship between incident characteristics and sexual harassment lawsuits.FindingsDisclosure of managers' sexually-oriented behavior is associated with a negative stock market reaction. Interestingly, the reaction was not more severe for sexual harassment disclosures compared to nonharassing behavior (i.e. workplace romance). Results also suggest that terminating a manager prior to disclosure of an event is negatively related to a harassment lawsuit.Originality/valueThe authors report this as the first study to focus on the stock market reaction of sexually-oriented harassing and nonharassing behavior of managers. This work complements research that documents the negative impact of sexual harassment on individuals by demonstrating these behaviors are associated with loss and risk at an organizational level.

scholarly journals Stock Market Reactions to Dividend Announcements: Empirical Evidence From the Singapore Stock Market

2018 ◽  
Vol 8 (2) ◽  
pp. 92
Author(s):  
Shailender Singh ◽  
Pooja Jain ◽  
Voon Chen Wei
Keyword(s):  
Stock Market ◽  
Stock Exchange ◽  
Market Reactions ◽  
Future Earnings ◽  
Share Prices ◽  
Dividend Announcements ◽  
Dividend Initiations ◽  
Size Of Firms ◽  
Stock Market Reactions ◽  
The Impact

The present study investigates the 50 randomly selected companies from Singapore Stock Exchange to assess the impact of the dividend initiation announcement and omission announcement on the share prices of the companies under study. The study has analyzed the impact of dividend initiations announcement on the size of firms by dividing the firms into small and big categories. Further, the relationship between changes in dividend and company’s future earnings is also analyzed. The study finds that the dividend initiation announcement’s impact on the share prices of Singapore companies is trivial and uncertain.

scholarly journals Social sentiment segregation: Evidence from Twitter and Google Trends in Chile during the COVID-19 dynamic quarantine strategy

PLoS ONE ◽  
2021 ◽  
Vol 16 (7) ◽  
pp. e0254638
Author(s):  
Fernando Díaz ◽  
Pablo A. Henríquez
Keyword(s):  
Stock Market ◽  
Media Coverage ◽  
Google Trends ◽  
Cross Sectional ◽  
Market Reactions ◽  
The Public ◽  
Health Authorities ◽  
Stock Market Reactions ◽  
High Degree ◽  
The Impact

The Chilean health authorities have implemented a sanitary strategy known as dynamic quarantine or strategic quarantine to cope with the COVID-19 pandemic. Under this system, lockdowns were established, lifted, or prolonged according to the weekly health authorities’ assessment of municipalities’ epidemiological situation. The public announcements about the confinement situation of municipalities country-wide are made typically on Tuesdays or Wednesdays before noon, have received extensive media coverage, and generated sharp stock market fluctuations. Municipalities are the smallest administrative division in Chile, with each city broken down typically into several municipalities. We analyze social media behavior in response to the confinement situation of the population at the municipal level. The dynamic quarantine scheme offers a unique opportunity for our analysis, given that municipalities display a high degree of heterogeneity, both in size and in the socioeconomic status of their population. We exploit the variability over time in municipalities’ confinement situations, resulting from the dynamic quarantine strategy, and the cross-sectional variability in their socioeconomic characteristics to evaluate the impact of these characteristics on social sentiment. Using event study and panel data methods, we find that proxies for social sentiment based on Twitter queries are negatively related (more pessimistic) to increases in the number of confined people, but with a statistically significant effect concentrated on people from the wealthiest cohorts of the population. For indicators of social sentiment based on Google Trends, we found that search intensity during the periods surrounding government announcements is positively related to increases in the total number of confined people. Still, this effect does not seem to be dependent on the segments of the population affected by the quarantine. Furthermore, we show that the observed heterogeneity in sentiment mirrors heterogeneity in stock market reactions to government announcements. We provide evidence that the observed stock market behavior around quarantine announcements can be explained by the number of people from the wealthiest segments of the population entering or exiting lockdown.

Stock Market Reactions to New Product Launches in International Markets: The Moderating Role of Culture

2019 ◽  
Vol 27 (4) ◽  
pp. 81-98 ◽  
Author(s):  
M. Berk Talay ◽  
M. Billur Akdeniz ◽  
Michael Obal ◽  
Janell D. Townsend
Keyword(s):  
Stock Market ◽  
Firm Value ◽  
New Product ◽  
International Markets ◽  
Product Launch ◽  
Market Reactions ◽  
Product Launches ◽  
Stock Market Reactions ◽  
The Impact

Prior research indicates the importance of new product launches across international markets for firm performance. However, little is known about if, and how, new product launches in international markets drive firm financial value. This study examines the drivers of stock market reactions to a new product introduction in a foreign country, along with the moderating impact of cultural context. Using a sample of 1,154 products in 34 product categories launched in 48 countries between 2011 and 2018, the authors investigate how product characteristics such as product innovativeness and product type affect abnormal stock reactions to a new product launch event. Furthermore, the authors assess the role of the national culture by considering the individualism, uncertainty avoidance, and indulgence characteristics of the country where the new product is launched. Results of a mixed-effects estimation model indicate that product launches in international markets with innovativeness and hedonism characteristics positively affect firm value. The effects of culture are complex and multifarious, providing valuable insights regarding the impact of new product introductions in global markets on firm value.

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