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We examine the usefulness and credibility of analyst recommendations by focusing on their behavior surrounding tender offer announcements. For our 1998-2001 sample, we find analysts did not identify takeover targets through their recommendations nor did they distinguish between wealth-increasing...
Persistent link: https://www.econbiz.de/10005523420
Despite mixed stock returns for acquirer shareholders in large stock-for-stock mergers, acquiring-firm merger proxy votes rarely fail; in the sample we examine, the average approval rate of votes cast is 95%. Our examination of whether merger votes are effective in monitoring management’s...
Persistent link: https://www.econbiz.de/10005704302
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We analyze several hundred firms that expand via acquisition and/or increase their number of business segments. The combined market reaction to acquisition announcements is positive but acquiring firm excess values decline after the diversifying event. Much of the excess value reduction occurs...
Persistent link: https://www.econbiz.de/10005162113
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IPO stock prices increased approximately 2.3% on the first day of secondary market trading over the period 1993 through 2003. While these aftermarket returns are accentuated during 1999 and 2000, they persist after the bubble burst and even increase as a percentage of total underpricing. We...
Persistent link: https://www.econbiz.de/10004987782
We examine over 7400 analyst recommendations made in the year after going public for IPOs from 1999 to 2000. Initiations of coverage at the end of the quiet period come almost exclusively from affiliated analysts, whereas initiations afterward are predominantly from unaffiliated analysts....
Persistent link: https://www.econbiz.de/10004999378
We examine underpricing, long-run returns, lockup periods, and gross spreads for penny stock IPOs over the 1990-1998 period. We find that penny stock IPOs have higher initial returns than ordinary IPOs, but significantly worse long-run underperformance. We also find that penny stock IPOs have...
Persistent link: https://www.econbiz.de/10005823840
We examine the extent to which offer prices reflect public information for 3,325 IPOs over the period 1990–1999. We focus primarily on four variables: share overhang, file range amendments, venture capital backing, and previous issue underpricing. We show that 35%–50% of the variation in IPO...
Persistent link: https://www.econbiz.de/10005139016
We investigate the pricing of 4,989 equity IPOs with offer dates between 1981 and 2000. Approximately three-fourths of these IPOs have integer offer prices. Average initial returns for IPOs with integer offer prices are significantly higher (24.5%) than those priced on the fraction of the dollar...
Persistent link: https://www.econbiz.de/10005139221