Do firms buy their stock at bargain prices? : Evidence from actual stock repurchase disclosure
- We use new data from SEC filings to investigate how S&P 500 firms execute their open market repurchase programs. We find that smaller S&P 500 firms repurchase less frequently than larger firms, and at a price which is significantly lower than the average market price. Their repurchase activity is followed by a positive and significant abnormal return which lasts up to three months after the repurchase. These findings do not hold for large S&P 500 firms. Our interpretation is that small firms repurchase strategically, whereas the repurchase activity of large firms is more focused on the disbursement of free cash. JEL Classification: G14, G30, G35 Keywords: Stock Repurchases, Stock Buybacks, Payout Policy, Timing, Bid-Ask Spread, Liquidity
Verfasserangaben: | Azi Ben-Rephael, Jacob Oded, Avi Wohl |
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URN: | urn:nbn:de:hebis:30-115334 |
Titel des übergeordneten Werkes (Deutsch): | Center for Financial Studies (Frankfurt am Main): CFS working paper series ; No. 2011,17 |
Schriftenreihe (Bandnummer): | CFS working paper series (2011, 17) |
Dokumentart: | Arbeitspapier |
Sprache: | Englisch |
Jahr der Fertigstellung: | 2011 |
Jahr der Erstveröffentlichung: | 2011 |
Veröffentlichende Institution: | Universitätsbibliothek Johann Christian Senckenberg |
Datum der Freischaltung: | 14.09.2011 |
Freies Schlagwort / Tag: | bid-ask spread; liquidity; payout policy; stock buybacks; stock repurchases; timing |
Ausgabe / Heft: | Version January 11, 2011 |
Seitenzahl: | 59 |
HeBIS-PPN: | 277073146 |
Institute: | Wissenschaftliche Zentren und koordinierte Programme / Center for Financial Studies (CFS) |
DDC-Klassifikation: | 3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft |
Sammlungen: | Universitätspublikationen |
Lizenz (Deutsch): | Deutsches Urheberrecht |