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- Title
The Intra-Industry Transfer of Information Inferred from Announcements of Corporate Security Offerings.
- Authors
Szewczyk, Samuel H.
- Abstract
This study investigates the extent to which information inferred by investors from initial announcements of corporate security offerings affects share prices in the capital markets. The empirical tests measure the response in the common stock prices of both firms announcing a security offering and non-announcing firms operating in the same industry. Small but significantly negative abnormal returns are shown by industry shares upon initial announcements of common stock, convertible debt, and straight debt public offerings. Such an industry response indicates that share prices incorporate an inside assessment of factors relevant to the valuation of an industry subset of firms.
- Subjects
CAPITAL market; STOCK prices; PRICES of securities; STOCKS (Finance); DEBT; VALUATION; CORPORATE finance; SECURITIES industry; INVESTORS; DEBT equity conversion
- Publication
Journal of Finance (Wiley-Blackwell), 1992, Vol 47, Issue 5, p1935
- ISSN
0022-1082
- Publication type
Article
- DOI
10.1111/j.1540-6261.1992.tb04689.x