Investor relations and IPO performance

• 成果类型: Article
• 署名作者: Chahine, Salim; Colak, Gonul; Hasan, Iftekhar; Mazboudi, Mohamad
• 署名单位: American University of Beirut; Hanken School of Economics; Fordham University
• 刊物名称: REVIEW OF ACCOUNTING STUDIES
• ISSN/ISSBN: 1380-6653
• DOI: 10.1007/s11142-019-09526-8
• 发表日期: 2020
• 页码: 474-512
• 关键词: initial public offerings; institutional investors; Textual analysis; Media coverage; press releases; price; Sentiment; FIRMS; money; RISK

摘要

We analyze the value of investor relations (IR) strategies to IPO firms. We find that firms that are less visible and have inexperienced management tend to hire IR consultants prior to the issue date. IR consultants help create positive news coverage before an IPO, as reflected in a more optimistic tone of published media. Their presence is associated with higher underpricing at the IPO date but with lower long-run returns. IR-backed IPOs also exhibit disproportionately higher insider-related agency problems, as IR-induced higher underpricing tends to occur primarily in IPOs where underwriter and venture capitalist agency conflicts are more severe. These findings suggest that the IR programs of IPO firm are mostly short-term oriented and facilitate the ulterior motives of some insiders (underwriters and venture capitalists) targeting higher first-day returns.