IPO Market Timing and Capital Structure: Evidences from Brazil

Vallandro, Luiz Felipe Jostmeier; Zani, João; Silva, Carlos Eduardo Schönerwald da

doi:10.5539/ibr.v8n1p24

Cited by 4 publications

(4 citation statements)

References 19 publications

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“…However, regression tests indicate no long-run persistence of market timing effects for over 2 years. The paper also suggests that determinants like tangibility, liquidity, macroeconomic variable, and interest rates better explains the debt-to-equity ratio of public companies [13].…”

Section: Market Timing Theorymentioning

confidence: 85%

“…The paper recognizes that equity market timing exists in the region but finds that there are no permanent effects on capital structure. According to the paper, managers actively reduce the leverage levels of their companies at appropriate times in the market in an attempt to take advantage [13]. However, regression tests indicate no long-run persistence of market timing effects for over 2 years.…”

Section: Market Timing Theorymentioning

confidence: 99%

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A Critical Review of the Effects of Stock Returns and Market Timing on Capital Structure

Ye,

Ji,

Zou

2023

Advances in Economics, Business and Management Research

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Capital structure is regarded as the combination of debt and equity firms use to finance operations and investments. The choice of capital structure significantly impacts a company's cost of capital, profitability, and risk profile. Among a series of factors that affect capital structure, this paper focuses on stock returns and market timing. In this review, an array of papers is analyzed to summarize current research claims regarding the influence of stock returns and market timing on capital structure. This paper also touches on other theories like the trade-off theory, the pecking order theory, and the signaling theory.

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Section: Market Timing Theorymentioning

confidence: 85%

Section: Market Timing Theorymentioning

confidence: 99%

A Critical Review of the Effects of Stock Returns and Market Timing on Capital Structure

Ye,

Ji,

Zou

2023

Advances in Economics, Business and Management Research

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“…Hot market shows its market value is high and cold market shows its market value is considered low by the market. According to (14,15) that the firm's hot market has positive effect on equity issuance activity. Using a distributed-lag regression model, (3) shows that lagged market-to-book ratio has a positive effect on equity issuance.…”

Section: Equity Market Timing Is Used When Issuing Equitymentioning

confidence: 99%

Equity Issue and a Long-Term Effect of Equity Market Timing on Capital Structure

Miswanto¹,

2018

IJET

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After the research about a short term effect of equity market timing on capital structure, the author is motivated to do research about a long term effect of equity market timing on capital structure of the firms which is listed in Indonesia Stock Exchange. The main problems on this research are to understand whether firms use equity market timing theory when issuing equity, and whether equity market timing has a long term effect on its capital structure. Then the purpose of this study is to examine the problems of this research. There are two hypothesis in this research. First, firms use equity market timing when issuing equity, and second, equity market timing has a long term effect on capital structure of firms in Indonesia. This research uses non-financial companies listed on the Indonesia Stock Exchange over the period of 2001 to 2011 as the sample. The data used in this research are panel data. The sample choosing is based on sample non-probability sampling using purposive sampling in form of judgment sampling. The research model used in this study is a distributed-lag regression model. The results of this research show that firms use equity market timing when issuing equity, and equity market timing does not have a long term effect on capital structure of firms in Indonesia. Thus, because there is deviation on the capital structure, then there is an indication that the firms will perform the process of speed adjustment towards the targeted capital structure, the optimum capital structure.

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“…From the start of the twenty-first century, Chinese stock markets and firms are following international practices and standards as also demanded by Chinese investors and regulators. Corporate governance and its relation with capital structure is the older concept, and literatures have established a positive, negative, or no relationship between corporate governance and leverage (Abraham et al 2015 ; Lee et al 2012 ; Lu-Andrews and Yu-Thompson 2015 ; Sharma 2015 ; Tsuruta 2015 ; Vallandro et al 2015 ; Yeh and Kuo 2015 ). In this study, researcher is trying to understand Chinese and American firms’ behavior with respect to corporate governance and capital structure decisions, and with that researcher is trying to identify the role of CSR in the previously mentioned relationship of corporate governance and capital structure.…”

Section: Introductionmentioning

confidence: 99%

Understanding the dynamics of capital structure, corporate governance, and corporate social responsibility in high- and low-leveraged US and Chinese firms

Mahmood

Arslan

Younas

et al. 2023

Environ Sci Pollut Res

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Corporate social responsibility turned into a global sensation from the inception of the twenty-first century in the corporate world and grabbed immense engrossment from all stakeholders in their decision-making process. Capital structure and corporate governance practices are the well-mellowed facets of corporate finance literature. In this study, the moderating role of corporate social responsibility (CSR) between corporate governance and leverage of the US and Chinese listed firms has been established, with a further extension of analyzing the moderating role of CSR between corporate governance and leverage in high vs low leveraged firms and high CSR vs low CSR firms as the novelty of this study and has never been examined in both economies and globally. The data of 1989 Chinese-listed firms from 28 sectors of the economy and 6640 US-listed firms from 27 sectors of the economy has been taken from 2001 to 2019 and analyzed through fixed effect regression and system generalized method of moment (GMM). Results of the study reveal that CSR and corporate governance are negatively associated with the leverage of both Chinese and US firms. Moreover, the moderating role of CSR has established between corporate governance and leverage negative relationship. The moderating role of CSR in the relationship of leverage and corporate governance is established only in low-leveraged firms whereas it is insignificant in high-leveraged firms. System GMM confirms the signs and significance of the regression results; that is why regression results are robust and reliable, and there is no endogeneity problem in our model. The study also gives an insight for future research on high- and low-leveraged firms and firms with more CSR score than less CSR score with other dimensions such as firm performance and firm value variables.

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IPO Market Timing and Capital Structure: Evidences from Brazil

Cited by 4 publications

References 19 publications

A Critical Review of the Effects of Stock Returns and Market Timing on Capital Structure

A Critical Review of the Effects of Stock Returns and Market Timing on Capital Structure

Equity Issue and a Long-Term Effect of Equity Market Timing on Capital Structure

Understanding the dynamics of capital structure, corporate governance, and corporate social responsibility in high- and low-leveraged US and Chinese firms

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