The single-firm event studies that securities litigants use to detect the impact of a corrective disclosure on a firm's stock price have low statistical power. As a result, observed price impacts are biased against defendants and systematically overestimate the effect on firm value. We use the...

The standard dividend discount model assumes an infinite stream of dividends, but many stocks disappear through merger at a premium at some point in their corporate life, with a current takeover probability of about 0.5% to 2% per year for publicly-traded firms in the U.S. Ignoring takeover...

It is well understood that the equity of an insolvent firm can trade for a positive price so long as there is some positive probability that the firm will become solvent at some future point. Currently, however, this insight exists in the case law in an informal sense, while its use in the...

Are event studies in securities litigation reliable? Basic's fraud-on-the-market presumption sparked the wide use of event studies in securities litigation, and the Supreme Court's 2014 decision in Halliburton will make event studies even more important, as litigants fight over the existence of...