Pricing Strategy and Corporate Bond Value

Min Shi; Wei Yu

doi:10.4018/joris.2012070103

Pricing Strategy and Corporate Bond Value

International Journal of Operations Research and Information Systems ◽

10.4018/joris.2012070103 ◽

2012 ◽

Vol 3 (3) ◽

pp. 40-52 ◽

Cited By ~ 3

Author(s):

Min Shi ◽

Wei Yu

Keyword(s):

Financial Markets ◽

Airline Industry ◽

Default Risk ◽

Time Windows ◽

Corporate Bond ◽

Pricing Strategy ◽

Industry Data ◽

Bond Returns ◽

Study Methodology ◽

Event Study Methodology

Pricing strategy is expected to impose profound impacts on a firm’s cash flow and default risk. However, little research has been done to examine its direct impacts on financial markets. Applying event study methodology on the airline industry data, this paper aims to fill this gap by investigating whether and how corporate bond value is affected by pricing cut events in the airline industry in various time windows. The authors’ empirical results find significant positive abnormal bond returns in the announcement month. However, the price effect becomes insignificant and vanishes in the following months. By integrating financial market and marketing behavior analysis, this paper provides managerial insights for both marketing managers and corporate bond investors.

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The Penalization of Non-Communicating UN Global Compact’s Companies by Investors and Its Implications for This Initiative’s Effectiveness

Business & Society ◽

10.1177/0007650315609303 ◽

2015 ◽

Vol 57 (2) ◽

pp. 255-291 ◽

Cited By ~ 9

Author(s):

Estefania Amer

Keyword(s):

United Nations ◽

Financial Markets ◽

Abnormal Return ◽

Cumulative Abnormal Return ◽

United Nations Global Compact ◽

External Monitoring ◽

Study Methodology ◽

A Company ◽

Event Study Methodology ◽

Do So

Companies that have joined the United Nations Global Compact (UNGC) are required to submit a Communication on Progress (COP), which is an environmental, social, and governance (ESG) report, to the UNGC every year. If they fail to do so, they are marked and listed as non-communicating on the UNGC website. Using the event study methodology, this study shows that a company that fails to report to the UNGC is penalized in the financial markets with an average cumulative abnormal return of −1.6% over a period of 5 trading days around the event. Although a major critique against the UNGC is that the initiative’s voluntary nature and its lack of external monitoring and sanction mechanisms render it ineffective in terms of the business participants’ implementation of the UNGC principles into their operations, this result suggests that investors may be able to pressure UNGC business participants to increase their compliance with the UNGC requirements and to “walk the talk.”

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Information Sharing Alliances in the Airline Industry: An Examination of Code Sharing Agreements

International Studies Review ◽

10.1163/2667078x-00601005 ◽

2005 ◽

Vol 6 (1) ◽

pp. 85-107

Author(s):

Wonseok Woo

Keyword(s):

Information Sharing ◽

Stock Returns ◽

Airline Industry ◽

Shareholder Wealth ◽

Wealth Effects ◽

Organizational Information ◽

Code Sharing ◽

Study Methodology ◽

Major Airlines ◽

Event Study Methodology

This paper addresses the issue of inter-organizational information-sharing alliances and their impacts on firm values from the perspective of inter-organizational coordination between partners in the airline industry setting. We investigate the shareholder wealth effects of inter-organizational information-sharing alliance arrangements, using 131 cede sharing agrc.unems in the airline industry betwcm 1984-1997. Employing event study methodology, we find that the information-sharing alliances between similar partners did create positive value in terms of stock returns at the time of alliance announcements to major US airlines. However, alliances between dissimilar partners resulted in significant losses of shareholder value to the major airlines. These results strongly support our main hypotheses, that information- sharing alliances arc successful and the benefits of such alliances are realized only when coordination difficulties can be effectively dealt with.

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EARNINGS ANNOUNCEMENTS AND THE SECURITY TRADE VOLUMES OF LISTED COMPANIES IN KENYA

American Journal of Economics ◽

10.47672/aje.561 ◽

2020 ◽

Vol 4 (1) ◽

pp. 50-66

Author(s):

Raude John O. Messo ◽

Charles Yugi Tibbs ◽

John Byaruhanga

Keyword(s):

Financial Markets ◽

Event Study ◽

Earnings Announcements ◽

Secondary Data ◽

Efficient Market Hypothesis ◽

Listed Companies ◽

Primary Data ◽

Study Methodology ◽

Anova Technique ◽

Event Study Methodology

Purpose: This study investigated the decline in the NSE N20, Kenya share index by examining the effects of Earnings announcements on the security trade volumes of companies listed on the NSE, Kenya, from 2013 to 2017. The study formulated a hypothesis that Earnings announcements did not significantly affect the security trade volumes of companies listed on the NSE, Kenya, applied Signaling theory, efficient market hypothesis, and Market expectation theory.Methodology: The study used the event study methodology, a mixed research design, and the ANOVA technique from 25 listed companies, collected secondary data using schedules and primary data using questionnaires.Findings: The study found the effect of Earnings announcements on the trade volumes to be insignificant. Hence, it concluded that earnings announcements did not affect the security trade volumes of companies listed on NSE, Kenya.Unique Contribution to Practice and Policy: The finding of this study will provide the market players with a better understanding of how Earnings announcements affect the security trade volumes; provide the policymakers with a basis of designing policies, regulating and controlling financial markets, complement existing studies in this area and strengthen the foundation for further research.

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