We examine the announcement period of stock returns for 179 over-the-counter (OTC) firms that issue common stock to reduce nonconvertible debt. We find that small OTC firms experience returns that are significantly more negative than large OTC firms. Regression tests reveal that firm size is a...

This study explores the role of issuance expenses in explaining the fall in stock value for OTC stock offerings that raise cash for debt reduction purposes. It estimates that over half of the sample's -2.79% two-day fall in stock value can be accounted for by issuance expenses when using a lower...

We examine 242 NYSE/AMEX and OTC common stock offerings that reduce bank debt and 254 that retire non-bank debt. We discover that bank debt reductions are associated with negative announcement period stock returns that are more than twice the magnitude of the negative returns found for non-bank...

Prior research of common stock offerings reaches different conclusions concerning the impact of issue costs on stock value. We identify factors that can best explain the different findings - most prominent are the issue costs measure and the listing. We investigate 323 common stock offerings and...

We examine the wealth impact of inside ownership on firms announcing leverage increases by issuing senior securities that retire junior securities. We find the market response to leverage increase announcements is influenced by the percentage of inside ownership. We show that firms with greater...

In this paper, I extend the stock-for-debt research by investigating whether stock value is influenced by how a firm changes its leverage ratio in relationship to its industry leverage ratio norm. I find that announcement-period stock returns for firms moving "away from" industry debt-to-equity...

We examine the wealth impact of inside ownership on firms announcing leverage increases by issuing senior securities that retire junior securities. We find the market response to leverage increase announcements is influenced by the percentage of inside ownership. We show that firms with greater...

Purpose – The purpose of this paper is to examine the impact of insider ownership decreases on stock returns for firms undergoing seasoned equity offerings (SEOs). Design/methodology/approach – Insider data were gathered for firms undergoing SEOs and this information used to compute the...