The Information Effects of Analyst Activity at the Announcement of New Equity Issues PDF Download

Author: Ranjan D'Mello
Publisher:
ISBN:
Category :
Languages : en
Pages :

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Book Description
Myers and Majluf (1984) argue that informational asymmetry between managers and investors can explain the negative stock returns around the announcement of new equity. Using analyst following and consensus as proxies for information asymmetry, we observe that announcement period returns are significantly more negative for firms followed by fewer analysts and whose forecasts exhibit less consensus. Our findings hold after controlling for firm size and growth opportunities. Finally, we find evidence suggesting that analyst activity also influences firms' long-term performance. We conclude that the information role of security analysts partially explains the negative stock returns surrounding the announcement of new equity.

Author: George J. Papaioannou
Publisher: Academic Press
ISBN: 0128032839
Category : Business & Economics
Languages : en
Pages : 334

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Book Description
Underwriting Services and the New Issues Market integrates practice, theory and evidence from the global underwriting industry to present a comprehensive description and analysis of underwriting practices. After covering the regulation and mechanics of the underwriting process, it considers economic topics such as underwriting costs and compensation, the pricing of new issues, the stock price and operating performance of issuing firms, the evaluation of new issue decisions, and an analysis of the many choices issuers face in structuring new issues. Unlike other books, it systematically develops a critical perspective about underwriting practices, both in the U.S. and international markets, and with a level of detail unavailable elsewhere and an approach that reveals how financial institutions deliver underwriting services. Underwriting Services and the New Issues Market delivers an innovative and long overdue look at security issuance. Foreword by Frank Fabozzi Covers underwriting contracts and arrangements on pricing and costs Focuses on the financial consequences of the issuance decision for the firm Describes and evaluates decisions regarding the features and structure of new security offerings.

Author: Ross Geddes
Publisher: Elsevier
ISBN: 0080478786
Category : Business & Economics
Languages : en
Pages : 273

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Book Description
An initial public offering (IPO) is one of the most significant events in corporate life. It follows months, even years of preparation. During the boom years of the late 1990s bull market, IPOs of growth companies captured the imagination and pocketbooks of investors like never before. This book goes behind the scenes to examine the process of an offering from the decision to go public to the procedures of a subsequent equity offering. The book is written from the perspective of an experienced investment banker describing the hows and whys of IPOs and subsequent equity issues. Each aspect of an IPO is illustrated with plenty of international examples pitched alongside relevant academic research to offer a combination of theoretical rigour and practical application. Topics covered are: - the decision to go public- legal and regulatory aspects of an offering; marketing and research- valuation and pricing- allocations of shares to investors - examination of fees and commissions * Global perpective: UK, European and US practices, regulations and examples, and case studies* First hand experience written by an IPO trader with academic rigour* Includes the changes in the market that resulted from 1998-2000 equity boom

Author: Benjamin Kleidt
Publisher: Springer Science & Business Media
ISBN: 3835090771
Category : Business & Economics
Languages : en
Pages : 181

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Book Description
Benjamin Kleidt analyzes why firms decide to issue hybrid securities. He provides insights into the financing behaviour of issuing firms with regard to operating and stock price performance prior and subsequent to hybrid security issues and shows that issuance motives for the use of different forms of hybrid securities are as diverse as available structures for this asset class.

Author: Ramazan Yildirim
Publisher: Walter de Gruyter GmbH & Co KG
ISBN: 3110713713
Category : Business & Economics
Languages : en
Pages : 323

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Book Description
In the present financial world, various niche markets play an increasingly important role. One of the fastest-growing niches is, without a doubt, Islamic finance. Indeed, sustainable finance needs constantly evolving innovations, and this book offers valuable insights into Islamic capital structure and Shari’ah equity screening enriching academic discourse. "In recent years, we have witnessed the emergence of a new generation of academics and professionals specializing in various aspects of Islamic finance as knowledge and practice. This has brought about a new dynamism and also further sophistication. This book is one of such contributions, as it develops knowledge which is then transformed into practice whereby practical impact is also achieved. Being an academic book, it provokes readers’ thoughts, offering a critique of the implications of the currently applied Shari’ah screenings methodologies. As a transformative practical piece, by developing an innovative screening ratio, in this book, Dr. Yildirim extends his focus on the risk-sharing based financing hierarchy, covers thoughts and the underlying philosophy, and proposes an Islamic version of a pecking order hierarchy. This framework can be considered the foundation for developing an Islamic capital structure theory. This book will benefit academics, professionals, investors, as well as policymakers working in the Islamic finance industry and would like to explore more." (Professor Dr. Mehmet Asutay, Durham University Business School, UK) "This book offers, for the first time after the inception of Shari’ah screening methodologies, a groundbreaking new stock screening solution that is comprehensible, practical, and foremost entirely derived from the primary sources of Islam (Qur’an and Sunnah). Congratulations to Dr. Ramazan for his outstanding contribution to Islamic finance and capital markets." (Associate Professor Dr. Ahcene Lahsasna) "This excellent book is a must-have for all corporate finance students/researchers interested in the theoretical aspect of capital structure and the religious discussion of Shari’ah equity screening. This book should become a companion to those involved in a quantitative research environment and aim to conduct a comparative analysis; an ideal resource for everyone, from Shari’ah scholars to Islamic finance practitioners and beginners to experts." (Professor Dr. M. Kabir Hassan, University of New Orleans, USA)

Author: H. Kent Baker
Publisher: John Wiley & Sons
ISBN: 0470569522
Category : Business & Economics
Languages : en
Pages : 516

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Book Description
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: Vijay Singal
Publisher: Financial Management Association Survey and Synthesis Series
ISBN: 0195304225
Category : Business & Economics
Languages : en
Pages : 369

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Book Description
In an efficient market, all stocks should be valued at a price that is consistent with available information. But as financial expert Singal points out, there are circumstances under which certain stocks sell at a price higher or lower than the right price. Here he discusses ten such anomalous prices and shows how investors might--or might not--be able to exploit these situations for profit.

Author: George M. Constantinides
Publisher: Elsevier
ISBN: 0080495079
Category : Business & Economics
Languages : en
Pages : 654

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Book Description
Volume 1A covers corporate finance: how businesses allocate capital - the capital budgeting decision - and how they obtain capital - the financing decision. Though managers play no independent role in the work of Miller and Modigliani, major contributions in finance since then have shown that managers maximize their own objectives. To understand the firm's decisions, it is therefore necessary to understand the forces that lead managers to maximize the wealth of shareholders.

Author: Yawen Jiao
Publisher:
ISBN:
Category :
Languages : en
Pages : 56

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Book Description
We develop a model of seasoned equity issues (SEOs) under asymmetric information where, in addition to observing the firm's issue/no issue decision, outsiders obtain quot;soft informationquot; signals about firms through noisy voluntary disclosures made by firms or information production by outsiders. We show that, if sufficiently precise soft information is available to outsiders, firms' equity issue behavior is significantly altered in equilibrium relative to that in existing models of SEOs. In particular, while existing models predict that the announcement effect to a public offering of equity will always be negative, our model predicts that the announcement effect will be positive for a significant fraction of SEOs. We predict that the announcement effect will be positive or negative depending on the realization of outsiders' soft information, the value of the firm's assets-in-place, and the net present value of its growth opportunities, with firms about which outsiders have more favorable soft information receiving algebraically larger (more positive or less negative) SEO announcement effects. We also have predictions for the relationship between the precision of outsiders' soft information and the amount of underinvestment in that firm, and for a firm's debt to equity ratio. Finally our model provides a rationale for the existence of quot;investor relationsquot; departments in many firms. We test two of the predictions of our model using stock price data of a sample of firms making equity issues, and using revisions in analyst recommendations and earnings forecasts as proxies for the realizations of outsiders' soft information signals about these firms. The evidence is consistent with the predictions of our model.

Author: Dr. Cheng-Few Lee
Publisher: Emerald Group Publishing
ISBN: 1800438702
Category : Business & Economics
Languages : en
Pages : 288

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Book Description
Advances in Pacific Basin Business, Economics, and Finance is an annual publication designed to focus on interdisciplinary research in finance, economics, accounting and management among Pacific Rim countries. All articles published have been reviewed and recommended by at least two members of the editorial board.