Dividend Changes and Stock Price Informativeness

Cesari, Amedeo De; Huang, Winifred

doi:10.2139/ssrn.2383924

Cited by 10 publications

(21 citation statements)

References 30 publications

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“…Moreover, the stock return synchronicity increases as market transparency (market informativeness) improves [10]. Hence stock price synchronicity can be proxied for market informativeness [12,[25][26][27][28]. In addition, idiosyncratic volatility is positively correlated to mispricing [29].…”

Section: Stock Price Synchronicitymentioning

confidence: 99%

Leverage structure and stock price synchronicity: Evidence from China

Zhang

Zhou

2020

PLoS ONE

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This paper investigate the impact of leverage structure on stock price synchronicity. To better understand the mechanism of the impact of leverage, we break leverage into operating leverage and financing leverage. This breakdown reveals the impact of different component of leverage. Moreover, in this paper, we employ the quantile regression model to investigate the impact of leverage on different level of stock price synchronicity, which provides us a more comprehensive picture. Our empirical results show, operating and financing leverage have negative impact on stock price synchronicity. Moreover, the higher the stock price synchronicity becomes, the higher this impact is. Furthermore, the marginal effect of financing leverage will be attenuated as the profitability of firms becomes higher, but the interaction effect doesn't exist for operating leverage. On the contrary, the marginal effect of financing leverage will be enhanced as the market capitalization of firms becomes larger, again, it doesn't exist for operating leverage. Finally, as firms are state-owned, the marginal effect of both operating and financing leverage will be higher.

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Section: Stock Price Synchronicitymentioning

confidence: 99%

Leverage structure and stock price synchronicity: Evidence from China

Zhang

Zhou

2020

PLoS ONE

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“…However, enhancing SPI has remained an issue in both the theoretical and empirical literature in the sense that the opportunistic behaviour of managers creates an environment of asymmetric information between managers and outside investors which prevents the latter from accurately pricing firm‐related specific information (Ben‐Nasr & Cosset, 2014; Kim, Zhang, Li, & Tian, 2014). Hence, the literature has analysed the various determinants (e.g., dividend changes, audit quality, state ownership, and board structure) of SPI (De Cesari & Huang‐Meier, 2015; Gul, Kim, & Qiu, 2010; Hou, Kuo, & Lee, 2012; Huang & Ni, 2017) with the aim of reducing the information asymmetry between managers and investors and of maximizing SPI.…”

Section: Introductionmentioning

confidence: 99%

Board of directors' foreign experience and stock price informativeness

et al. 2020

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We investigate the impact of board of directors' foreign experience on stock price informativeness from 2008 to 2016 in Chinese A‐share listed firms. The empirical findings suggest that board of directors' foreign experience has a positive and significant impact on stock price informativeness. By analysing the role of external monitoring factors, our results show that board of directors' foreign experience has a positive and significant impact on stock price informativeness in the absence of external monitoring factors such as audit quality, the cross‐listing of firms, and foreign ownership. Our findings are robust to the use of advanced techniques and the inclusion of instrumental variables. Overall, our study supports the resource dependency theory and the substitutional effect on the relationship between board of directors' foreign experience and stock price informativeness.

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“… 17 Recent studies employ similar measures of stock return nonsynchronicity to proxy for stock price firm-specific information. 6 , 14 , 16 - 22 We require at least 100 daily stock return observations during the last fiscal year to ensure explanatory power. One concern of our study is whether the primary results are sensitive to the particular measure of stock price informativeness.…”

Section: Methodsmentioning

confidence: 99%

“…It extends from CAPEX to cash savings, dividend payments, seasoned equity issuance, labor investment, and M&A investment. 4 - 10 These studies argue that when stock prices reflect more firm-specific information, managers make corporate decisions that are more aligned with the value of firm fundamentals and therefore achieve higher operating performance. Among all these studies on stock price informativeness, no such study has focused on a particular industry.…”

Section: Introductionmentioning

confidence: 99%

Merger & Acquisition and Capital Expenditure in Health Care

Ouyang

Hilsenrath

2017

INQUIRY

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Investment, especially through merger and acquisition (M&A), is a leading topic of concern among health care managers. In addition, the implications of this activity for organization and market concentration are of great interest to policy makers. Using a sample of 2256 firm-year observations in the health care industry during the period from 1985 to 2011, this article provides novel evidence that managers learn from financial markets in making capital expenditure (CAPEX) and M&A investment decisions. Within the industry, managers in the Drugs subsector are most likely to do so, whereas managers in the Medical Equipment and Supplies are least likely to do so. We find informative stock prices improve firm financial performance. This article highlights the importance of financial markets for real economic activity in the health care industry.

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Dividend Changes and Stock Price Informativeness

Cited by 10 publications

References 30 publications

Leverage structure and stock price synchronicity: Evidence from China

Leverage structure and stock price synchronicity: Evidence from China

Board of directors' foreign experience and stock price informativeness

Merger & Acquisition and Capital Expenditure in Health Care

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