Purpose – The primary purpose of this paper is to test the prediction that overpricing drives merger waves. Design/methodology/approach – The authors supplement proxies of overpricing from the existing literature such as subsequent under-performance, the form of consideration/financing and...

Purpose –Researchers suspect that the overvaluation of equity issuing acquirers is a major cause of their subsequent post-event underperformance. Definitive conclusions regarding this overpricing hypothesis have not been possible since indicators of overpricing such as the book-to-market ratio...

The board of directors is considered pivotal in a company's corporate governance architecture. However, the board is just one of several governance mechanisms. External shareholders may be more concerned with the overall monitoring of management provided by the market for corporate control,...

Estimates of the earnings response coefficient (ERC) can be improved by including leading returns in return-earnings models [Kothari and Sloan (1992), Donnelly and Walker (1995)]. This improvement in estimated ERC can be used to measure price anticipation of earnings. The research reported here...