Abstract:In the last decade the number of buyback transactions involving listed companies in the Italian equity capital market has experienced a huge growth. However, no clear understanding of this phenomenon has yet been reached, also because of the limited information available on such financial decisions. The purpose of this paper is to check the main hypotheses behind the determinants of share repurchases, analysing the effect of own share buyback announcements specifically on the performance of the listed companie… Show more
The purpose of this paper is to examine the effect of accounting conservatism on share repurchases for firms listed on the Egyptian stock exchange. The research hypothesis was derived, which is represented in: There is a negative relationship between the accounting conservatism and share repurchases. Multiple regression and logistic regression were used to test the research hypothesis. The sample used in the current study consists of 24 firms listed on the Egyptian stock exchange for the period from 2000 through 2019. To the best of the researcher knowledge, there are no Egyptian studies to date that examined the effect of accounting conservatism on share repurchases. Consequently, this paper contributes to the limited literature by suggesting a new model for the effect of of accounting conservatism on share repurchases. The researcher concludes that the new model is useful in explaining the effect of accounting conservatism on share repurchases. The study finds that (a) accounting conservatism has a significant negative effect on share repurchases, (b) Free cash flow has a significant positive effect on share repurchases, (c) Firm size has a significant positive effect on share repurchases, (d) Firm leverage ratio has a significant negative effect on share repurchases.
The purpose of this paper is to examine the effect of accounting conservatism on share repurchases for firms listed on the Egyptian stock exchange. The research hypothesis was derived, which is represented in: There is a negative relationship between the accounting conservatism and share repurchases. Multiple regression and logistic regression were used to test the research hypothesis. The sample used in the current study consists of 24 firms listed on the Egyptian stock exchange for the period from 2000 through 2019. To the best of the researcher knowledge, there are no Egyptian studies to date that examined the effect of accounting conservatism on share repurchases. Consequently, this paper contributes to the limited literature by suggesting a new model for the effect of of accounting conservatism on share repurchases. The researcher concludes that the new model is useful in explaining the effect of accounting conservatism on share repurchases. The study finds that (a) accounting conservatism has a significant negative effect on share repurchases, (b) Free cash flow has a significant positive effect on share repurchases, (c) Firm size has a significant positive effect on share repurchases, (d) Firm leverage ratio has a significant negative effect on share repurchases.
This paper contributes to existing literature on open market share repurchases in Italy by studying authorisations that the board of directors needs to obtain from the shareholders' general meeting in order to acquire company's own shares. In such a context, I investigate whether the buyback purpose that managers disclose in their report affects number of shares to be repurchased. Particularly, since managers could potentially benefit from share repurchase programmes carried out in the presence of stock option plans, I explore whether this motivation influences the number of shares they require to include in the buyback programme. In pursuit of my objectives, I analyse reports managers provide shareholders' meeting to obtain the authorisation to acquire company's own shares over a 6-year period (2004-2009) in Italian listed companies. Main results suggest that the buyback motivation affects number of shares managers intend repurchasing, highlighting the role of the quality of the board of directors in this issue.
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