Does market misvaluation drive post-acquisition underperformance in stock deals?

研究成果: Article同行評審

14 引文 斯高帕斯(Scopus)


There is limited direct evidence on the impact of market misvaluation on acquirer long run performance. In this paper, we hypothesize that stock prices of stock-financed acquirers would move toward their fundamental value in the long run, thus correcting the initial overvaluation. Empirical results show that more overvalued acquirers are associated with poorer post-acquisition abnormal returns. We eliminate the concern that our findings are due to either overpayment or overvaluation-driven bad acquisitions. Our results are robust to controlling for market-wide valuation, alternative methods and assumptions used to calculate abnormal returns and fundamental value, and other factors affecting acquirer returns.

頁(從 - 到)690-706
期刊International Review of Economics and Finance
出版狀態Published - 2011 十月

All Science Journal Classification (ASJC) codes

  • Finance
  • Economics and Econometrics

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