Earticle

초록

영어

This study documents evidence that share repurchases have become persistent in recent years, as an increasing number of firms repurchase shares year after year. This persistence means that share repurchases are now a long-term cash flow commitment. As a result, previous notions about share repurchases—such as considering them a means of distributing transitory cash flow, or a response to undervaluation or raising the debt ratio—have little explanatory power. Instead, share repurchases are linked to fast, consistent future growth, which is reflected in the high stock valuation of share repurchasing firms. Firms use cash flow as the primary source of capital to finance share repurchases year after year. This financing has cumulatively large effects on capital structure, as share repurchasing firms experience large, steady increases in retained earnings and comparable decreases in paid-in capital over time. On average, share repurchases do not displace investment, as share repurchasing firms invest actively to generate fast growth that in turn helps finance repeated share repurchases.

목차

Abstract
Abstract
1. Introduction
2. Review of existing studies on share repurchases
3. Data
4. Prologue: an increasing trend of repeated share repurchases over the period 1980-2017
4.1. Proportions of firms that repurchase shares consecutively
4.2. Logit regressions
5. Main analyses
5.1. The SDC share-repurchase announcement sample
5.2. Firm characteristics of share repurchase announcement firms
5.3. Tobit regressions of share repurchases
5.4. Five-year changes in firm attributes after share repurchases
5.5. Change in capital structure over (t-4, t+4) for top-half share repurchasing firms
5.6. Underinvestment and over-investment of share repurchasing firms
6. Additional Analyses
6.1. Tobit regressions for the periods before and after 1994
6.2. Characteristics of non-share repurchasing firms
6.3. How similar or different are dividends and share repurchases?
7. Concluding remarks

키워드

저자

• Sadok El Ghoul [ University of Alberta, Edmonton, ABT6G 2R6, Canada ]
• Omrane Guedhami [ University of South Carolina, Columbia, SC 29208, USA ]
• Hyunseok Kim [ Sungkyunkwan University (SKKU), Seoul, 13063 Korea ]
• Jungwon Suh [ Sungkyunkwan University (SKKU), Seoul, 13063 Korea ]

참고문헌

발행기관

간행물

표지보기 관심저널 등록

• 간행물명

  한국재무학회 학술대회

• 간기

  부정기

• 수록기간

  2006~2024

• 십진분류

  KDC 325 DDC 330