The Effect of Capital Structure Changes on the Earnings Response Coefficients PDF Download
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Author: Jee In Jang
Publisher:
ISBN:
Category : Corporate debt
Languages : en
Pages : 22
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Book Description
Examines whether the riskiness of a firm's debt (default risk) affects the relationship between unexpected changes in earnings and stock returns.
Author: Jee In Jang
Publisher:
ISBN:
Category : Corporate debt
Languages : en
Pages : 22
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Book Description
Examines whether the riskiness of a firm's debt (default risk) affects the relationship between unexpected changes in earnings and stock returns.
Author: Thomas A. Carnes
Publisher:
ISBN:
Category :
Languages : en
Pages : 142
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Book Description
Author: Thomas A. Carnes
Publisher:
ISBN:
Category : Price-earnings ratio
Languages : en
Pages : 284
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Book Description
Author: Benjamin M. Friedman
Publisher: University of Chicago Press
ISBN: 0226264238
Category : Business & Economics
Languages : en
Pages : 404
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Book Description
The research reported in this volume represents the second stage of a wide-ranging National Bureau of Economic Research effort to investigate "The Changing Role of Debt and Equity in Financing U.S. Capital Formation." The first group of studies sponsored under this project, which have been published individually and summarized in a 1982 volume bearing the same title (Friedman 1982), addressed several key issues relevant to corporate sector behavior along with such other aspects of the evolving financial underpinnings of U.S. capital formation as household saving incentives, international capital flows, and government debt management. In the project's second series of studies, presented at the National Bureau of Economic Research conference in January 1983 and published here for the first time along with commentaries from that conference, the central focus is the financial side of capital formation undertaken by the U.S. corporate business sector. At the same time, because corporations' securities must be held, a parallel focus is on the behavior of the markets that price these claims.
Author: Mohamed Fathi Mohamed Ali
Publisher:
ISBN:
Category : Capital
Languages : en
Pages : 488
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Book Description
Author: Uptal Bhattacharya
Publisher:
ISBN: 9789616430258
Category :
Languages : en
Pages : 27
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Author:
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
This paper reports new findings from applying portfolio method, which shows a much bigger earnings impact on share prices (ERC) compared to the erstwhile reports of ERC using individual events, averaged over the sample. We estimate cumulative abnormal returns, CAR, across a test window for each quarterly earnings announcement event across one accounting year. The CARs are then regressed against earnings changes of individual firms and portfolios. The findings show a significant positive CAR when earnings increases; and a negative CAR if earnings declines. The ERC is very small in the test period of 2001-14, which is consistent with published results for years before 2000. The ERC size magnifies substantially due to the grouping effect used through portfolio formation. What is significant is that the use of portfolio method, by removing the idiosyncratic errors, show a price response very close to the size of earnings (i.e., ERC of 0.93) with a very high R-square of 75 percent. The last evidence supports strongly the value relevance accounting theory that has not seen much support from averaging the price responses of individual event responses.
Author: Sharjil M. Haque
Publisher: International Monetary Fund
ISBN: 1589064127
Category : Business & Economics
Languages : en
Pages : 51
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Book Description
We study the impact of the COVID-19 recession on capital structure of publicly listed U.S. firms. Our estimates suggest leverage (Net Debt/Asset) decreased by 5.3 percentage points from the pre-shock mean of 19.6 percent, while debt maturity increased moderately. This de-leveraging effect is stronger for firms exposed to significant rollover risk, while firms whose businesses were most vulnerable to social distancing did not reduce leverage. We rationalize our evidence through a structural model of firm value that shows lower expected growth rate and higher volatility of cash flows following COVID-19 reduced optimal levels of corporate leverage. Model-implied optimal leverage indicates firms which did not de-lever became over-leveraged. We find default probability deteriorates most in large, over-leveraged firms and those that were stressed pre-COVID. Additional stress tests predict value of these firms will be less than one standard deviation away from default if cash flows decline by 20 percent.
Author: Allen William Bathke
Publisher:
ISBN:
Category : Accounting
Languages : en
Pages : 339
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Book Description
Author: Thomas J. Frecka
Publisher:
ISBN:
Category : Capital
Languages : en
Pages : 66
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Book Description
