Under new management: Equity issues and the attribution of past returns

• 成果类型: Article
• 署名作者: Baker, Malcolm; Xuan, Yuhai
• 署名单位: Harvard University; National Bureau of Economic Research; University of Illinois System; University of Illinois Urbana-Champaign
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2016.03.001
• 发表日期: 2016
• 页码: 66-78
• 关键词: Equity issues; Seasoned equity offerings; Reference point; ceo turnover

摘要

There is a strong link between measures of stock market performance and subsequent equity issues. We find that management turnover weakens the link between equity issues and the returns that preceded the new chief executive officer (CEO). Moreover, there is a discontinuity in the distribution of equity issues around the specific share price that the CEO inherited, while there is no discontinuity around salient share prices prior to turnover. The evidence suggests that capital allocation involves an attribution of past returns not only to the firm but also to its CEO. A corollary is that a firm with poor stock market performance may be better able to raise new capital if its current CEO is replaced. (c) 2016 Elsevier B.V. All rights reserved.