scholarly journals Further Evidence on Stock Price Response to Changes in Weekly Money and the Discount Rate

1985 ◽  
Author(s):  
R. W. Hafer
Keyword(s):  
Discount Rate ◽  
Stock Price ◽  
Price Response

Stock Price Response to Transacting Technology Rights: Quick Reversal of Good Fortunes?!

2012 ◽  
Author(s):  
Abdelaziz Chazi ◽  
Ashraf Khallaf ◽  
Yi (Ian) Liu ◽  
Zaher Zantout
Keyword(s):  
Stock Price ◽  
Price Response

The Effect of Acquirer Net Operating Losses on Acquisition Premiums and Acquirer Abnormal Returns

2019 ◽  
Vol 41 (2) ◽  
pp. 103-124
Author(s):  
Merle M. Erickson ◽  
Karen Ton ◽  
Shiing-wu Wang
Keyword(s):  
Stock Price ◽  
Abnormal Returns ◽  
Price Response ◽  
Transaction Prices ◽  
Merger Announcement ◽  
Tax Benefits

ABSTRACT This study examines whether acquirer NOL-related tax benefits generated in an acquisition are shared with the target. For a sample of 1,959 acquisitions, we find that acquisitions of profitable targets by acquirers with NOLs are associated with higher acquisition premiums than acquisitions by non-NOL acquirers. This result indicates that potential post-acquisition tax benefits from use of acquirer NOLs are shared with the target in the form of higher transaction prices. We also find that the acquirer's merger announcement stock price response is positively associated with these tax benefits, which is consistent with the conclusion that acquirers retain part of these potential tax benefits.

An Analysis of the Sources of Value Loss Following Financial Restatements

2021 ◽  
pp. 0148558X2198991
Author(s):  
Philip K. Hong ◽  
Jaywon Lee ◽  
Sang-Hyun Park ◽  
Sukesh Patro
Keyword(s):  
Stock Returns ◽  
Cash Flow ◽  
Discount Rate ◽  
Stock Price ◽  
Cash Flows ◽  
Financial Fraud ◽  
Earnings Persistence ◽  
Flow Component ◽  
Financial Restatements ◽  
Value Loss

We decompose the total value loss around firms’ announcements of financial restatements into components arising from investors’ revisions in cash flows and discount rates. First, relative to population benchmarks, restatements represent circumstances in which the cash flow component becomes more important in explaining valuations. While we find significant contributions from both sources, with the cash flow component explaining more than 33% of the variation in stock returns surrounding restatement announcements, this component explains only 13% to 22% in comparable non-restating firms. When restatements are caused by underlying financial fraud, the discount rate impact becomes more important, explaining about 88% of return variation. On the contrary, the cash flow impact is relatively larger for firms with higher earnings persistence or restatements associated with errors. Our decomposition of the value loss helps explain returns in the post-announcement period. Firms with a higher relative discount rate impact experience a significant downward stock price drift after the initial announcement-related price decline. For firms with a higher relative cash flow impact, the evidence suggests the initial impact of the restatement announcement is more complete with no subsequent drift pattern. Our findings close gaps in the evidence on financial restatements and extend the literature on the drivers of stock price movements.

Stock Price Response to Calls of Convertible Bonds: Still a Puzzle?

2007 ◽  
Vol 36 (2) ◽  
pp. 1-21 ◽  
Author(s):  
Ivan E. Brick ◽  
Oded Palmon ◽  
Dilip K. Patro
Keyword(s):  
Stock Price ◽  
Convertible Bonds ◽  
Price Response

Agency Costs and the Short-Run Stock Price Response to Capital Expenditures

2012 ◽  
Vol 47 (2) ◽  
pp. 375-399
Author(s):  
Sungsoo Kim ◽  
Eugene Pilotte ◽  
Joon Sun Yang
Keyword(s):  
Stock Price ◽  
Agency Costs ◽  
Capital Expenditures ◽  
Price Response ◽  
Short Run

scholarly journals The Effects of Operational Structure Change on Performance after Seasoned Equity Offerings

2017 ◽  
Author(s):  
Chihyoun Ahn ◽  
Mi-Ok Kim ◽  
Hyung-Rok Jung
Keyword(s):  
Sustainable Development ◽  
Stock Price ◽  
Operating Performance ◽  
Seasoned Equity Offerings ◽  
Structure Change ◽  
Equity Offerings ◽  
Price Response ◽  
Sustainability Strategy ◽  
Rate Of Increase ◽  
Operational Structure

Sustainability is directly linked to firms’ survival in competitive markets. To survive, firms need extra capital, and seasoned equity offerings (SEOs) are one sustainability strategy. Additional resources from SEOs leads to changes in firms’ operational structure, which brings future sustainability. This study investigates whether there is sustainability in firms’ operational structure and the effects of sustainable development on operational performance and market reaction. We measure the operational structure change of firms as three proxies: 1) the rate of increase in the number of operating segments, 2) the Berry–Herfindahl index using the ratio of sales of each operating segment out of total sales, and 3) the size of net investment in plant and equipment. Our results show that operational structure change has a statistically significant and positive correlation with long-term operating performance. In addition, there is no significant stock price response at first, but the operating performance in the next term is perceived as a favorable factor after 3 years. The results show that there are different responses in the stock market toward operational structure change. The empirical results confirm that firms with SEO have sustainable development in operational structure and that markets recognize firms’ sustainability strategy arising from SEOs.

A Study on Stock Price Response to Disclosure Effect by Purpose of Corporate Divestiture

2018 ◽  
Vol 20 (3) ◽  
pp. 1243-1254
Author(s):  
Jong kook Kim ◽  
Youngtae Byun ◽  
Soo Kyung Kim
Keyword(s):  
Stock Price ◽  
Price Response

scholarly journals Quantifying stock-price response to demand fluctuations

2002 ◽  
Vol 66 (2) ◽  
Author(s):  
Vasiliki Plerou ◽  
Parameswaran Gopikrishnan ◽  
Xavier Gabaix ◽  
H. Eugene Stanley
Keyword(s):  
Stock Price ◽  
Price Response ◽  
Demand Fluctuations
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