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Anomalous Price Behavior Around Repurchase Tender Offers

Anomalous Price Behavior Around Repurchase Tender Offers ABSTRACT This paper reports anomalous price behavior around repurchase tender offers. Buying shares before the expiration date of a repurchase tender offer and tendering to the firm produces, on average, abnormal returns of more than 9 percent over a period shorter than one week. In addition, we find that repurchasing companies experience economically and statistically significant abnormal returns in the two years after the repurchase. The upward price drift is mainly caused by the behavior of the small firms in the sample. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png The Journal of Finance Wiley

Anomalous Price Behavior Around Repurchase Tender Offers

The Journal of Finance , Volume 45 (2) – Jun 1, 1990

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References (23)

Publisher
Wiley
Copyright
1990 The American Finance Association
ISSN
0022-1082
eISSN
1540-6261
DOI
10.1111/j.1540-6261.1990.tb03698.x
Publisher site
See Article on Publisher Site

Abstract

ABSTRACT This paper reports anomalous price behavior around repurchase tender offers. Buying shares before the expiration date of a repurchase tender offer and tendering to the firm produces, on average, abnormal returns of more than 9 percent over a period shorter than one week. In addition, we find that repurchasing companies experience economically and statistically significant abnormal returns in the two years after the repurchase. The upward price drift is mainly caused by the behavior of the small firms in the sample.

Journal

The Journal of FinanceWiley

Published: Jun 1, 1990

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