How did the Sarbanes–Oxley Act affect managerial incentives? Evidence from corporate acquisitions

AbstractWe examine the impact of incentive compensation on the riskiness of acquisition decisions before and after the passage of the Sarbanes–Oxley Act (SOX). Before SOX, equity-based compensation was positively related to changes in risk around acquisition decisions, but this relationship weakened after the introduction of SOX. The drop in post-SOX acquisition-related risk stems from how managers respond to compensation-based incentives in the new regulatory environment. We show that executive stock options and pay-risk sensitivity drive post-SOX managerial responsiveness to risk-taking incentives. We also document a post-SOX value-enhancing effect on long-term stock-price performance and total factor productivity through these same incentive compensation mechanisms. The results are robust to selection bias, simultaneity, measurements of risk, and the definition of incentive compensation.

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Building stock market resilience through digital transformation: using Google trends to analyze the impact of COVID-19 pandemic

Frontiers of Business Research in China ◽

10.1186/s11782-020-00089-z ◽

2020 ◽

Vol 14 (1) ◽

Cited By ~ 2

Author(s):

Ding Ding ◽

Chong Guan ◽

Calvin M. L. Chan ◽

Wenting Liu

Keyword(s):

Stock Market ◽

Stock Prices ◽

Stock Price ◽

Digital Transformation ◽

Google Trends ◽

Building Stock ◽

Market Sentiment ◽

Price Performance ◽

Novel Coronavirus ◽

The Impact

Abstract As the 2019 novel coronavirus disease (COVID-19) pandemic rages globally, its impact has been felt in the stock markets around the world. Amidst the gloomy economic outlook, certain sectors seem to have survived better than others. This paper aims to investigate the sectors that have performed better even as market sentiment is affected by the pandemic. The daily closing stock prices of a total usable sample of 1,567 firms from 37 sectors are first analyzed using a combination of hierarchical clustering and shape-based distance (SBD) measures. Market sentiment is modeled from Google Trends on the COVID-19 pandemic. This is then analyzed against the time series of daily closing stock prices using augmented vector autoregression (VAR). The empirical results indicate that market sentiment towards the pandemic has significant effects on the stock prices of the sectors. Particularly, the stock price performance across sectors is differentiated by the level of the digital transformation of sectors, with those that are most digitally transformed, showing resilience towards negative market sentiment on the pandemic. This study contributes to the existing literature by incorporating search trends to analyze market sentiment, and by showing that digital transformation moderated the stock market resilience of firms against concern over the COVID-19 outbreak.

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The Impact of COVID-19 on the Stock Price of Socially Responsible Enterprises: An Empirical Study in Taiwan Stock Market

International Journal of Environmental Research and Public Health ◽

10.3390/ijerph18041398 ◽

2021 ◽

Vol 18 (4) ◽

pp. 1398

Author(s):

Kuo-Jung Lee ◽

Su-Lien Lu

Keyword(s):

Stock Market ◽

Stock Prices ◽

Stock Price ◽

Abnormal Returns ◽

Recovery Phase ◽

Socially Responsible ◽

Cumulative Impact ◽

Study Approach ◽

Price Performance ◽

The Impact

This study examines the impact of the COVID-19 outbreak on the Taiwan stock market and investigates whether companies with a commitment to corporate social responsibility (CSR) were less affected. This study uses a selection of companies provided by CommonWealth magazine to classify the listed companies in Taiwan as CSR and non-CSR companies. The event study approach is applied to examine the change in the stock prices of CSR companies after the first COVID-19 outbreak in Taiwan. The empirical results indicate that the stock prices of all companies generated significantly negative abnormal returns and negative cumulative abnormal returns after the outbreak. Compared with all companies and with non-CSR companies, CSR companies were less affected by the outbreak; their stock prices were relatively resistant to the fall and they recovered faster. In addition, the cumulative impact of the COVID-19 on the stock prices of CSR companies is smaller than that of non-CSR companies on both short- and long-term bases. However, the stock price performance of non-CSR companies was not weaker than that of CSR companies during times when the impact of the pandemic was lower or during the price recovery phase.

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The importance of information upon applying IFRS in financial entities that trade at the Colombian stock market

Revista CIFE Lecturas de Economía Social ◽

10.15332/22484914/5200 ◽

2019 ◽

Vol 21 (34) ◽

pp. 137-152

Author(s):

Miguel Angel Laverde Sarmiento ◽

Jorge Fernando Garcia Carrillo ◽

Juan Carlos Lezama Palomino ◽

Alejandra Patiño Jacinto

Keyword(s):

Financial Reporting ◽

Stock Price ◽

Stock Exchange ◽

Regulatory Framework ◽

General Level ◽

Market Exchange ◽

Generally Accepted Accounting Principles ◽

Financial Reporting Standards ◽

Before And After ◽

The Impact

The aim of this research is to determine whether the implementation of the International Financial Reporting Standards (IFRS) in the companies of the financial sector listed on the Colombian Stock Exchange has greater relevance compared to the previous accounting regulatory framework known as Generally Accepted Accounting Principles (GAAP) in Colombia, for the years 2009 to 2016. Taking into account the concept of valorative relevance that indicates that the accounting information is relevant if it affects the stock price reflected in the capital market exchange. To determine this relationship, an adaptation of the model proposed by Ohlson (1995) is used, because it is the most frequently used to measure relevance. The modifications made to the model were to include accounting variables of financial instruments of assets and liabilities to better measure the impact of the IFRS. On a general level, the conclusion is reached that the valorative relevance of financial companies listed on the stock exchange between 2009 and 2016, does not change due to the application of the IFRS. The results are because the regulation that financial companies that are listed on the stock exchange of Colombia are subject to has contributed to the relevance being maintained before and after the application of the new regulatory framework. however, when carrying out the study of the information taking into account only the variables and taking into account the regulations under the IFRS, they present a greater degree of significance.

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Causal Relation Between Stock Market Performance and Firm Investment in China: Mediating Role of Information Asymmetry

SAGE Open ◽

10.1177/2158244019885146 ◽

2019 ◽

Vol 9 (4) ◽

pp. 215824401988514

Author(s):

Ghulam Hussain Khan Zaigham ◽

Xiangning Wang ◽

Haji Suleman Ali

Keyword(s):

Information Asymmetry ◽

Stock Prices ◽

Stock Price ◽

Stock Exchange ◽

Causal Relation ◽

Negative Relationship ◽

Manufacturing Firms ◽

Price Performance ◽

Stock Market Performance ◽

The Impact

The main objectives of this study are to examine the impact of stock price performance on firm’s investment and to investigate the counter impact of changes in investment expenditures on stock price performance. The random effects model was applied on the panel data of Chinese manufacturing firms listed at the Shanghai Stock Exchange and the Shenzhen Stock Exchange during the period 2002 to 2016. The sample contains 398 firms with 5,970 observations. Although there is a statistically significant and negative relationship between stock price and investment expenditures, the impact of stock price on investment expenditures is far greater than that of investment expenditures on stock price. Information asymmetry positively mediates both investment sensitivity to stock prices and stock prices sensitivity to investment. This study is a valuable contribution toward the analysis of investment decision making by manufacturing firms in China. It also provides guidelines for investors to assess the informational status of the capital market before making investment decisions and to comprehensively understand the different decisions made by firms with regard to the issue of new stocks and the indirect information attached with such issues.

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LONG-TERM ADJUSTMENT OF CAPITAL STRUCTURE: EVIDENCE FROM SINGAPORE, HONG KONG AND TAIWAN

The Singapore Economic Review ◽

10.1142/s0217590812500270 ◽

2012 ◽

Vol 57 (04) ◽

pp. 1250027

Author(s):

TERENCE TAI-LEUNG CHONG ◽

DANIEL TAK-YAN LAW ◽

LIN ZOU

Keyword(s):

Hong Kong ◽

Capital Structure ◽

Stock Price ◽

Pecking Order ◽

Price Performance ◽

Growth Opportunity ◽

Timing Effects ◽

The Impact ◽

Internal Fund

This paper examines the impact of profitability, stock price performance and growth opportunity on the capital structure of firms in Singapore, Taiwan and Hong Kong. In contrast to Kayhan and Titman (2007), it is found that firms in these three Chinese-dominated economies strongly prefer debt to equity or internal fund financing. They also take advantage of stock price appreciation by issuing more shares. An adjustment model for debt ratios is estimated. The results suggest that the leverage ratios of these firms slowly adjust toward their target levels. Deviations from the target due to the pecking order and market timing effects are found to be significant.

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The Impact of Corona Virus Disease 2019 (COVID-19) on Indonesia Property Stock Index

Petra International Journal of Business Studies ◽

10.9744/ijbs.4.2.85-96 ◽

2021 ◽

Vol 4 (2) ◽

pp. 85-96

Author(s):

Kevin Ronaldo Gotama ◽

Njo Anastasia

Keyword(s):

Stock Prices ◽

Stock Price ◽

Stock Exchange ◽

Virus Disease ◽

Sampling Technique ◽

Stock Index ◽

Event Analysis ◽

Corona Virus ◽

Before And After ◽

The Impact

A promising investment in the property sector is due to appreciation in property value. As an economic instrument, the stock market, inseparable from different environmental factors, was triggered by incident in Wuhan, Hubei Province, China, an outbreak of acute respiratory tract infection 2 (SARS-CoV-2) in December 2019 and then spread across China. This study is a comparative study on the stock index of the property sector on the stock exchange of countries affected by the Corona Virus Disease 2019 (COVID-19) case, with a purposive sampling technique according to certain criteria for sample selection. The event analysis was performed by analyzing market reaction; with COVID-19 incident effect as one of the event tests, the stock price index. The findings of the study indicate that there is an index response to the incident of COVID-19. The reflected reaction shows in the abnormal return and trade volume activity before and after the incident. Thus, this study is expected to be taken into consideration for stock investors regarding the impact of the Corona Virus Disease 2019 (COVID-19) pandemic on stock prices, by providing an overview of changes in stock prices during the monitoring period, so that they can make investment decisions in the period before and after incident.

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The corporate governance endgame – minority squeeze-out regulation and post-deal litigation in Germany

Managerial Finance ◽

10.1108/mf-01-2016-0032 ◽

2017 ◽

Vol 43 (1) ◽

pp. 95-123 ◽

Cited By ~ 4

Author(s):

Ettore Croci ◽

Eric Nowak ◽

Olaf Ehrhardt

Keyword(s):

Detailed Analysis ◽

Stock Prices ◽

Stock Price ◽

Minority Shareholders ◽

Content Type ◽

Stock Market Reaction ◽

Price Performance ◽

Cash Compensation ◽

Squeeze Out ◽

The Impact

Purpose The purpose of this paper is to examine minority squeeze-outs and their regulation in Germany, a country where majority shareholders have extensively used this tool since its introduction in 2002. Using unique hand-collected data, the authors carry out the first detailed analysis of the German squeeze-out offers from the announcement to the outcome of post-deal litigation, examining also the determinants of the decision to squeeze-out minority investors. Design/methodology/approach Using unique data on court rulings and compensations, the authors analyze a sample of 324 squeeze-outs of publicly listed companies from 2002 to 2011 to carry out the first detailed analysis of the squeeze-out procedure and the post-deal litigation. The authors employ the event study methodology to assess the stock market reaction around the announcement of the squeeze-out. Findings Large firms with foreign large shareholders are the most likely to be delisted. Positive stock price performance increases the likelihood of a squeeze-out, but operating performance has the opposite effect. Stock prices react positively to squeeze-out announcements, in particular when the squeeze-out does not follow a previous takeover offer. Post-deal litigation is widespread: nearly all squeeze-outs are legally challenged by minority shareholders. Additional cash compensation is larger in appraisal procedures, but actions of avoidance are completed in less time. Overall, the evidence suggests that starting post-deal litigation by challenging the cash compensation offered in a squeeze-out delivers high returns for minority investors. Research limitations/implications The lack of data concerning the identity of minority shareholders in firms undergoing a squeeze-out does not allow a proper investigation of the incentives of the different types of investors. Practical implications The paper provides evidence about the incentives of the different players in a squeeze-out offer. The findings of the paper could be helpful in assessing the impact of the squeeze-out rule. The results also contribute to the understanding of minority investors’ incentives to start post-deal litigation. Originality/value This paper provides new evidence about post-deal litigation, in particular how investors use the procedures that the system provides them to protect themselves against controlling shareholders. The paper examines all the phases of the squeeze-out procedure and challenges.

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Improved Survival of Periviable Infants after Alteration of the Threshold of Viability by the Neonatal Resuscitation Program 2015

Children ◽

10.3390/children8010023 ◽

2021 ◽

Vol 8 (1) ◽

pp. 23

Author(s):

Yen-Ju Chen ◽

Wen-Hao Yu ◽

Li-Wen Chen ◽

Chao-Ching Huang ◽

Lin Kang ◽

...

Keyword(s):

Gestational Age ◽

Significant Risk ◽

Neonatal Resuscitation ◽

Comfort Care ◽

Before And After ◽

Long Term Follow Up ◽

Neonatal Resuscitation Program ◽

Definition Of ◽

The Impact

Periviable infants (PIs) born at 22–25 weeks gestational age (wGA) have a variable survival rate (49.7–86.2%) among hospitals. One factor involved in this difference may be the definition of the threshold of viability. The American Academy of Pediatrics revised the neonatal resuscitation program in late 2015 (NRP 2015) and altered the threshold of viability from 23 to 22 wGA. The impact on the survival of PIs after the guideline alteration has seldom been discussed. Since 2016, the unit of this study has implemented the renewed guideline for PIs. We retrospectively reviewed and analyzed the survival and clinical variables of PIs before and after implementation of the guideline, which included a 10-year cohort in a single center in Taiwan. There were 168 PIs enrolled between 2010 and 2019 (Epoch-I, 2010–2015; Epoch-II, 2016–2019), after excluding those with congenital anomalies and parent-decided comfort care. Compared to those in Epoch-I, the PIs in Epoch-II had significantly higher odds ratios (2.602) (95% confidence interval: 1.170–5.789; p = 0.019) for survival. Younger gestational age, small size for gestational age, cesarean delivery, low blood pH at birth, and surfactant therapeutic treatment were found to be significant risk factors associated with the survival of PIs (p < 0.05 for each). The altered threshold of viability by NRP 2015 may impact the survival of PIs. However, long-term follow-up for surviving PI is required in the future.

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Dampak Covid-19 terhadap Fluktuasi Harga Saham dan Volume Transaksi Saham pada Perusahaan Subsektor Telekomunikasi Yang Terdaftar di Bursa Efek Indonesia

EKONOMIS Journal of Economics and Business ◽

10.33087/ekonomis.v5i1.194 ◽

2021 ◽

Vol 5 (1) ◽

pp. 73

Author(s):

Listya Devi Junaidi ◽

Lukman Hakim Siregar ◽

Malesa Anan

Keyword(s):

Stock Prices ◽

Stock Price ◽

Teaching And Learning ◽

Hypothesis Test ◽

Work From Home ◽

Normality Test ◽

Before And After ◽

Telecommunication Companies ◽

The Government ◽

The Impact

The impact of the spread of the COVID-19 outbreak is not only detrimental to human health but also detrimental to the country's economy both domestically and abroad. After the announcement of the entry of this outbreak to Indonesia on March 2, 2020, the government tried to make various efforts to reduce the spread of this virus, namely by conducting social distancing, work from home (WFH) and, teaching and learning activities from home. This activity requires people to always be in touch with electronic media such as laptops, smartphones, etc. However, this situation has benefited subsector Telecommunication companies where the need for internet services is increasing. This study aims to determine how the comparison of stock prices and share transaction volume in telecommunication sub-sector companies before and after the announcement of the spread of COVID-19 in Indonesia. This research uses A normality test and hypothesis test Paired Sample T-Test. The results of this study indicate that COVID-19 has a significant impact on the value of stock prices and the volume of stock transactions in the telecommunications sub-sector where the value of stock prices and the volume of stock price transactions that had previously increased but decreased.

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Dampak Kenaikan Harga Tiket Pesawat Terhadap Return dan Harga Saham pada PT. Garuda Indonesia Tbk di Bursa Efek Indonesia

Jurnal Ilmiah Ekonomi Global Masa Kini ◽

10.36982/jiegmk.v10i1.718 ◽

2019 ◽

Vol 10 (1) ◽

pp. 1

Author(s):

Agung Anggoro Seto ◽

Dian Septianti

Keyword(s):

Stock Price ◽

Stock Exchange ◽

T Test ◽

Price Increase ◽

Aviation Industry ◽

Analysis Model ◽

Paired Sample ◽

Before And After ◽

The Impact ◽

Airline Ticket

ABSTRACTThis research aims to analyze the impact of the price increase of airfare against return and the stock price of PT. Garuda Indonesia Tbk. This type of research is comparative. The Data used in this research is the secondary return and stock price of the weekly PT. Garuda Indonesia TBK in Indonesia Stock Exchange, with the amount of data 21 weeks before and 21 weeks after the price increase of airfare. Data analysis Model used the paired sample t-test. The results showed that there was no return on shares of PT. Garuda Indonesia TBK before and after the price increase of the airline ticket with a significance value of 0.887. The results also showed that there was a difference in the stock price of PT. Garuda Indonesia TBK before and after the price increase of the airline ticket with a significance value of 0.000. Where the stock price after the increase of the average airline ticket price is greater Rp. 239.143. The difference in the stock price of PT. Garuda Indonesia TBK. Before and after airfare increases due to investor perception or positive sentiments that assess the price increase in the aviation industry will benefit Airline companies. The high investor confidence and improvement of management system is believed to affect the investor's desire to invest in PT. Garuda Indonesia TBK So it has a significant impact on the price increase of PT. Garuda Indonesia TBK Post Airfare increases.Keywords : Return, Stock Price, Price AirfareABSTRAKPenelitian ini bertujuan untuk menganalisis dampak kenaikan harga tiket pesawat terhadap return dan harga saham PT. Garuda Indonesia Tbk. Jenis penelitian adalah komparatif, data yang digunakan pada penelitian ini adalah sekunder berupa return dan harga saham mingguan PT. Garuda Indonesia Tbk di Bursa Efek Indonesia, dengan jumlah data sebanyak 21 minggu sebelum dan 21 minggu sesudah kenaikan harga tiket pesawat. Model analisis data yang digunakan paired sample t test. Hasil penelitian menunjukkan tidak terdapat perbedaan return saham PT. Garuda Indonesia Tbk sebelum dan sesudah kenaikan harga tiket pesawat dengan nilai signifikansi sebesar 0,887. Hasil penelitian juga menunjukkan bahwa terdapat perbedaan harga saham PT. Garuda Indonesia Tbk sebelum dan sesudah kenaikan harga tiket pesawat dengan nilai signifikansi sebesar 0,000. Dimana harga saham setelah kenaikan harga tiket pesawat rata-rata lebih besar Rp. 239,143 Adanya perbedaan harga saham PT. Garuda Indonesia Tbk. sebelum dan sesudah kenaikan harga tiket pesawat disebabkan oleh persepsi investor atau adanya sentimen positif yang menilai kenaikan harga tiket pada industri penerbangan akan menguntungkan bagi perusahaan penerbangan. Tingginya kepercayaan investor dan perbaikan sistem manajemen diyakini berpengaruh terhadap keinginan investor untuk berinvestasi di PT. Garuda Indonesia Tbk sehingga berdampak signifikan terhadap peningkatan harga saham PT. Garuda Indonesia Tbk pasca kenaikan harga tiket pesawat.Kata kunci: Return, Harga Saham, Harga Tiket

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