Equity Market Misvaluation, Financing, and Investment

SSRN Electronic Journal ◽

10.2139/ssrn.2142209 ◽

2012 ◽

Cited By ~ 10

Author(s):

Missaka Warusawitharana ◽

Toni M. Whited

Keyword(s):

Equity Market ◽

Financing And Investment ◽

Market Misvaluation

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Equity Market Misvaluation, Financing, and Investment

Review of Financial Studies ◽

10.1093/rfs/hhv066 ◽

2015 ◽

pp. hhv066 ◽

Cited By ~ 17

Author(s):

Missaka Warusawitharana ◽

Toni M. Whited

Keyword(s):

Equity Market ◽

Financing And Investment ◽

Market Misvaluation

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Equity Market Misvaluation, Financing, and Investment

Finance and Economics Discussion Series ◽

10.17016/feds.2013.78 ◽

2013 ◽

Vol 2013 (78) ◽

pp. 1-50

Author(s):

Missaka Warusawitharana ◽

◽

Toni M. Whited

Keyword(s):

Equity Market ◽

Financing And Investment ◽

Market Misvaluation

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Equity Market Misvaluation and Firm Financial Policies

SSRN Electronic Journal ◽

10.2139/ssrn.2023595 ◽

2012 ◽

Author(s):

Toni M. Whited ◽

Missaka Warusawitharana

Keyword(s):

Equity Market ◽

Financial Policies ◽

Market Misvaluation

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Are Observed Capital Structures Determined by Equity Market Timing?

Journal of Financial and Quantitative Analysis ◽

10.1017/s0022109000002489 ◽

2006 ◽

Vol 41 (1) ◽

pp. 221-243 ◽

Cited By ~ 117

Author(s):

Armen Hovakimian

Keyword(s):

Capital Structure ◽

Market Timing ◽

Investment Decisions ◽

Equity Market ◽

Growth Opportunities ◽

Market Conditions ◽

Negative Relation ◽

Financing And Investment ◽

Equity Market Timing

AbstractContrary to Baker and Wurgler (2002), I find that the importance of historical average market-to-book ratios in leverage regressions is not due to past equity market timing. Although equity transactions may be timed to equity market conditions, they do not have significant long lasting effects on capital structure. Debt transactions exhibit timing patterns that are unlikely to induce a negative relation between market-to-book ratios and leverage. I also find that historical average market-to-book ratios have significant effects on current financing and investment decisions, implying that they contain information about growth opportunities not captured by current market-to-book ratios.

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