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Share Repurchase and Stock Price

  • Harold BiermanJr.

Abstract

What happens to a firm’s stock price when the firm repurchases its shares? Initially, we will assume:
  1. a

    the market price is equal to the stock’s intrinsic value

     
  2. b

    there are no psychological reactions by the stock market or signaling effects

     
  3. c

    the market has anticipated the effects on stock value of a share repurchase program if such a program is to be implemented.

     

Keywords

Market Price Stock Price Capital Gain Common Stock Share Repurchase 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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References

  1. Ikenbury, D., J. Lakonishok, and T. Vermaelen, “Market Underreacting to Open Market Share Repurchases,” Journal of Financial Economics, V39, N2–3 (October, 199) pp 181–208.Google Scholar

Copyright information

© Springer Science+Business Media New York 2001

Authors and Affiliations

  • Harold BiermanJr.
    • 1
  1. 1.The Johnson Graduate School of ManagementCornell UniversityIthacaUSA

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