Earnings Management and Delisting Risk of Initial Public Offerings PDF Download
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Author: Jinliang Li
Publisher:
ISBN:
Category :
Languages : en
Pages : 56
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Book Description
Earnings management is a corporate decision subject to costs. Both earnings management in the IPO process and the ex ante delisting risk of newly issued firms are related to firm fundamentals. With a sample of IPOs from 1980 to 1999, we find that the degree of earnings management possesses significant predictive power on IPO failure. IPO firms associated with aggressive earnings management are more likely to delist for performance failure, and tend to delist sooner. Furthermore, we find that IPO firms associated with conservative earnings management are more likely to be merged or acquired and they earn positive abnormal returns. Our results also show that IPO issuers manage earnings in response to market demand. Market-wide earnings management of IPO firms interacts with the IPO cycle documented by Lowry and Schwert (2002).
Author: Jinliang Li
Publisher:
ISBN:
Category :
Languages : en
Pages : 56
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Book Description
Earnings management is a corporate decision subject to costs. Both earnings management in the IPO process and the ex ante delisting risk of newly issued firms are related to firm fundamentals. With a sample of IPOs from 1980 to 1999, we find that the degree of earnings management possesses significant predictive power on IPO failure. IPO firms associated with aggressive earnings management are more likely to delist for performance failure, and tend to delist sooner. Furthermore, we find that IPO firms associated with conservative earnings management are more likely to be merged or acquired and they earn positive abnormal returns. Our results also show that IPO issuers manage earnings in response to market demand. Market-wide earnings management of IPO firms interacts with the IPO cycle documented by Lowry and Schwert (2002).
Author: Siew Hong Teoh
Publisher:
ISBN:
Category : Cash management
Languages : en
Pages : 58
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Book Description
Author: Siew Hong Teoh,T.J.Wong,Gita R. Rao
Publisher:
ISBN:
Category :
Languages : en
Pages : 44
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Book Description
Author: Barbara Fidanza
Publisher: Springer
ISBN: 3319950495
Category : Business & Economics
Languages : en
Pages : 185
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Book Description
In an organized and organic way, this book covers all the possible theoretical and empirical facets of delisting, adding to the well-developed literature on IPOs. IPO and delisting are strictly related; the reasons for delisting may be found in the loss of the incentives that drove the firm to the public market in the past. However, the book presents unique motivations not directly related to the IPO decision. This book covers what the existing literature has not in focusing on specific aspects such as market liquidity and microstructure, listing costs, market for corporate control, corporate governance issues and so on. Of interest to academics and students, this contribution puts all pieces in order and finds a thread that can link each theory to the others.
Author: Fotini Mastroianni
Publisher: GRIN Verlag
ISBN: 3668440700
Category : Business & Economics
Languages : en
Pages : 36
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Book Description
Essay from the year 2012 in the subject Economics - Finance, , language: English, abstract: The main reason why companies decide to proceed with IPO is mainly to gain access to new funding. The proceeds from the share issue itself are not necessarily intended for direct expansion. The prospects for growth from acquisitions, the funds available for organizational expansion and refinancing of current borrowings have shown, among other things, to be the main motives that newly listed companies consider as very important. The general initial public offering procedure enhances the image and publicity of enterprises and gets not only an initial certification of the professionals in the financial markets but also a long-term price bidding (price signal) to suppliers, workforce and customers. According to Roell (1996), a robust equity value in the subsequent acquisition (during the trading of securities after their initial bid for public offering) reassures suppliers that they can safely grant trade credit, employees are convinced that they can expect a fairly stable job, and customers think that the products of the company will be supported as a result of their purchase (in the aftermath of their purchase).
Author: Maria J. Pastor-Llorca
Publisher:
ISBN:
Category :
Languages : en
Pages : 37
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Book Description
The poor stock price performance of firms conducting initial public offerings is one of the recent puzzles in financial literature. We detect this market anomaly for Spanish IPO firms and we investigate whether earnings management around the time of the offering can explain these results. Consistent with this explanation, we notice that issuing firms make use of discretionary accruals to report higher earnings in the IPO year. Moreover, firms with higher level of discretionary accruals experience more negative long-run abnormal returns. Thus, this evidence suggests that opportunistic earnings management explains, at least partially, the IPO anomaly in Spain.
Author: Rolf J. Daxhammer
Publisher: UVK Verlag
ISBN: 3739801735
Category : Business & Economics
Languages : de
Pages : 217
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Book Description
In a corporations financial life going public by means of an IPO is probably the single most important decision. It turns a private company into a public one. Our book will provide an inside view of the IPO process. On the one hand, it draws on the insights of an experienced investment banker, who has gone through numerous IPO transactions. On the other hand, it relates the story of an actual IPO through the eyes of a Chief Executive Officer who has taken two of his companies public. This unique double perspective is our books defining feature. We do not discuss initial public offerings in a textbook style fashion. What we would like to bring out is a more comprehensive portrayal of a once-in-a-lifetime event for most companies and their management, alike.
Author: Alok Pande
Publisher:
ISBN:
Category : Going public (Securities)
Languages : en
Pages : 27
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Book Description
Author: Arvin Ghosh
Publisher: Routledge
ISBN: 1351496743
Category : Business & Economics
Languages : en
Pages : 156
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Book Description
In this timely volume on newly emerging financial mar- kets and investment strategies, Arvin Ghosh explores the intriguing topic of initial public offerings (IPOs) of securities, among the most significant phenomena in the United States stock markets in recent years. Before the 2000-2001 market turndown, hardly a week went by when more than a few companies did not become public, either in the organized stock exchange or in the Over the Counter (OTC) market. In the often over-burdened, technology-heavy Nasdaq market, the role of IPOs was crucial for the market's new vigor and growth. Internet stocks were able to find a mode to supply key momentum to the market. In the so-called "New Economy" of the 1990s, it was the seductively accessible IPO that ushered in the world's information technology revolution.Ghosh sets out to examine the pricing and financial performance of IPOs in the United States during the period 1990-2001. In the opening chapter he discusses the rise and fall of IPOs in the preceding decade. Chapter 2 further delineates the IPO process from the start of the prospectus to the end of the "quiet period" and aftermarket stabilization. In chapter 3 Ghosh analyzes the mispricing and deliberately deceptive underpricing, or "flipping," of Internet IPOs. Chapter 4 delves deeper into the pricing and operating efficiency of Nasdaq IPOs. Chapter 5 analyzes the pricing and long-run performance of IPOs both in the New York Stock Exchange and in the Nasdaq markets. In chapters 6 and 7 the author deals with the pricing and performance of the venture-blocked and nonventure-backed IPOs in general and Internet IPOs in particular. In chapter 8 he analyzes the role of underwriters as market makers. In chapter 9 Ghosh discusses the accuracy of analysts' earnings forecasts. In the concluding chapter, he summarizes the principal findings of the study and the recent revival of the IPO market and its place in capital formation as well as the latest developments in t
Author: Seth Anderson
Publisher: Springer Science & Business Media
ISBN: 1461522951
Category : Business & Economics
Languages : en
Pages : 126
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Book Description
Initial public offerings (IPOs) play a crucial role in allocating resources in market economies. Because of the enormous importance of IPOs, an understanding of how IPOs work is fundamental to an understanding of financial markets generally. Of particular interest is the puzzling existence of high initial returns to equity IPOs in the United States and other free-market economies. Audience: Designed for use by anyone wishing to perform further academic research in the area of IPOs and by those practitioners interested in IPOs as investment vehicles.
