We examine the key drivers behind management decisions on share repurchase from various theoretical perspectives, including the free cash flow theory and the signaling theory/hypothesis. Specifically, we investigate the relationship between share repurchase and three key drivers: surplus cash,...

This paper examines whether share repurchase announcements are signals of undervaluation or insiders’ opportunistic activities by investigating insider trading patterns surrounding buyback announcements in Vietnam. Consistent with the insider opportunism hypothesis, we show that insiders are...

Purpose: The purpose of this report was to assess the relationship among the cash dividend payout and share repurchase, through essential cash distribution methods adopted by Vietnamese publicly listed companies. The complementary along with substitute relationship from these financial practices...

Purpose: The purpose of this report was to assess the relationship among the cash dividend payout and share repurchase, through essential cash distribution methods adopted by Vietnamese publicly listed companies. The complementary along with substitute relationship from these financial practices...

This paper presents a novel study on the significance of corporate payout policy in shaping firms' financial decision-making and, in turn, the macroeconomy. To this end, we add to the literature by allowing households and firms to choose share buybacks optimally. We then explore the implications...

Stock repurchases of banks have become an increasingly popular instrument of banks' payout policies after the Great Financial Crisis. Recent empirical evidence documents that stock repurchases are particularly popular among global systemically important banks that tolerate relatively high levels...

"This study examined the relationship between share repurchases and corporate sustainability in South Africa during 2011-2019. According to stakeholder theory, companies may feel a sense of obligation to not only distribute returns to shareholders through share repurchases but also to other...

This study examines whether the use of tax haven subsidiaries by U.S. multinational corporations (MNCs) is associated with more intense use of share buybacks and with improvement in management's ability to generating revenues. I find that MNCs' more intensive tax haven subsidiary use is...

We empirically advocate for UK regulators to increase the volume limit of 15% outstanding shares on open market repurchases. Our main framework initially tests the determinants of share repurchases based on their size, Small, Medium and Large. The findings reveal that consistent with extant...

This paper explores the impact of open market share repurchases (OMR) on stock price synchronicity. We find that share repurchases significantly enhances the information content of stock prices, reflected in reduced price synchronicity. The mechanism includes repurchases drawing investor...

The discount control mechanisms that closed-end funds often choose to adopt before IPO are supposedly implemented to narrow the difference between share price and net asset value, We find evidence that non-discretionary discount control mechanisms such as mandatory continuation votes serve as...

Public attention to a firm may provide valuable monitoring, but it may also have a dark side by constraining management’s decisions and distracting it. We use inclusion in the S&P 500 index as a positive shock to public attention. Media coverage, Google searches, SEC downloads, SEC comment...

There is a puzzle that few undervalued firms make repurchase announcements in China despite the value-adding motive of share repurchases. Inspired by the puzzle, this paper explores the market timing effect of the repurchase signaling. We find a positive relationship between the...

We study whether CEO narcissism affects a firm’s share repurchase announcements and their implementations. Using signature characteristics as a measure of narcissism, we find that US firms with narcissist CEOs are more likely to make repurchase announcements and announce higher repurchase...

We consider an entrepreneur having an option to invest in a project and a potential growth investment option. The two-stage investment costs are financed by secured loans and paid by insurers respectively. We develop explicit models to describe guarantee costs, the timing and pricing of the...

We develop policy gradients methods for stochastic control with exit time in a model-free setting. We propose two types of algorithms for learning either directly the optimal policy or by learning alternately the value function (critic) and the optimal control (actor). The use of randomized...

This article exclusively formulates and presents three innovative hypotheses related to the execution of share buybacks, employing Genetic Algorithms (GAs) and mathematical optimization techniques. Drawing on the foundational contributions of scholars such as Osterrieder, Seigne, Masters, and...

This research brief delves into the intricate domain of share buyback execution, particularly focusing on the temporal optionality aspect, which has been overlooked in traditional execution practices. Using a novel dataset sourced from regulatory filings on share buybacks, we employ Monte Carlo...

This research brief delves into the intricate domain of share buyback execution, particularly focusing on the temporal optionality aspect, which has been overlooked in traditional execution practices. Using a novel dataset sourced from regulatory filings on share buybacks, we employ Monte Carlo...

This paper introduces a novel hypothesis in the context of share buybacks, proposing the existence of a "Free Lunch" phenomenon associated with the use of specific execution products. The hypothesis posits that these products can generate consistently positive fees, offering a consistent return...

This hypothesis paper explores a potential anomaly within the realm of share buybacks, positing an inevitable brokerage outperformance due to temporal optionality. The hypothesis under examination is that brokerage firms, regardless of stock price movements, can consistently outperform due to...

We consider an entrepreneur who has an option to invest in an irreversible but delayable project. If the project is sufficiently profitable, the firm has an option to make a growth investment, which makes the project cash flow increase by a constant factor. The entrepreneur has no money to...

Accelerated share repurchases (ASRs) are a type of stock buyback wherein the repurchasing firm contracts a financial intermediary to acquire the shares on its behalf. The intermediary purchases the shares from the open market and is compensated by the firm according to the average of the stock...

Textbook theory assumes that firm managers maximize the net present value of future cash flows. But when you ask them, the people running large public corporations say that they are maximizing something else entirely: earnings per share (EPS). Perhaps this is a mistake. No matter. We take...

It is widely believed that undervaluation is an important determinant of share repurchases. However, empirical evidence on undervaluation remains mixed. This paper considers a novel measure of undervaluation that relies on the difference between management earnings forecasts and the...