Can the Stock Market Success of Montreal's IPOs be Predicted by the Prospectus' Content?

Can the Stock Market Success of Montreal's IPOs be Predicted by the Prospectus' Content? In this paper, we investigated if it is possible for investors to objectively estimate the probability of success of newly public companies using the information contained in offering prospectuses. Analysing prospectuses of small firms that went public on the Montreal Stock Exchange revealed that the age of the firm at the time of the IPO, the percentage of voting rights sold by managers, the sales growth potential and the subscription price of newly quoted firms could be good predictors of long-term performance on the stock market. However, it is relatively difficult to link any information contained in the issuing prospectus to short-term performance. The findings of this study should help authorities to define more stringent criteria to accept new public offerings and make the small cap market more attractive to investors and new growing companies. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Small Business Economics Springer Journals

Can the Stock Market Success of Montreal's IPOs be Predicted by the Prospectus' Content?

Loading next page...
 
/lp/springer_journal/can-the-stock-market-success-of-montreal-s-ipos-be-predicted-by-the-J7cr4QXUxb
Publisher
Kluwer Academic Publishers
Copyright
Copyright © 2000 by Kluwer Academic Publishers
Subject
Business and Management; Management; Microeconomics; Entrepreneurship; Industrial Organization
ISSN
0921-898X
eISSN
1573-0913
D.O.I.
10.1023/A:1026507813481
Publisher site
See Article on Publisher Site

Abstract

In this paper, we investigated if it is possible for investors to objectively estimate the probability of success of newly public companies using the information contained in offering prospectuses. Analysing prospectuses of small firms that went public on the Montreal Stock Exchange revealed that the age of the firm at the time of the IPO, the percentage of voting rights sold by managers, the sales growth potential and the subscription price of newly quoted firms could be good predictors of long-term performance on the stock market. However, it is relatively difficult to link any information contained in the issuing prospectus to short-term performance. The findings of this study should help authorities to define more stringent criteria to accept new public offerings and make the small cap market more attractive to investors and new growing companies.

Journal

Small Business EconomicsSpringer Journals

Published: Oct 8, 2004

References

You’re reading a free preview. Subscribe to read the entire article.


DeepDyve is your
personal research library

It’s your single place to instantly
discover and read the research
that matters to you.

Enjoy affordable access to
over 12 million articles from more than
10,000 peer-reviewed journals.

All for just $49/month

Explore the DeepDyve Library

Unlimited reading

Read as many articles as you need. Full articles with original layout, charts and figures. Read online, from anywhere.

Stay up to date

Keep up with your field with Personalized Recommendations and Follow Journals to get automatic updates.

Organize your research

It’s easy to organize your research with our built-in tools.

Your journals are on DeepDyve

Read from thousands of the leading scholarly journals from SpringerNature, Elsevier, Wiley-Blackwell, Oxford University Press and more.

All the latest content is available, no embargo periods.

See the journals in your area

DeepDyve Freelancer

DeepDyve Pro

Price
FREE
$49/month

$360/year
Save searches from Google Scholar, PubMed
Create lists to organize your research
Export lists, citations
Read DeepDyve articles
Abstract access only
Unlimited access to over
18 million full-text articles
Print
20 pages/month
PDF Discount
20% off