The Post-Acquisition Return Anomaly: Evidence from Quarterly Earnings Announcement Stock Reaction
Date Issued
2004
Date
2004
Author(s)
Pu, Hsin-Yu
DOI
en-US
Abstract
I investigate how the features of acquisition, such as form of deal, method of payment and firm characteristics influence the acquiring firms’ stock performance following acquisitions. For the sample of 4094 US acquisitions completed during the period from 1980 to 1997, I examine the stock reaction to quarterly earnings announcements from two years before to five years after the effective date. The method of payment and firm size do matter to the short-run stock reaction while form of deal, book to market ratio and price to earnings ratio have no obvious impact on the short-run stock reaction. The detailed analysis suggests that the method of payment dominates form of deal, book to market ratio and price to earnings ratio in explaining the post-merger stock performance. I also calculate the long-run abnormal returns using the calendar-time portfolio approach. The result is roughly consistent with the short-run stock reaction to quarterly earnings announcement.
Subjects
公司特性
購併
盈餘宣告
acquisition,earnings surprise
firm characteristics
Type
thesis