EconPapers    
Economics at your fingertips  
 

Does Investor Misvaluation Drive the Takeover Market?

Ming Dong, David Hirshleifer, Scott Richardson and Siew Hong Teoh

Journal of Finance, 2006, vol. 61, issue 2, 725-762

Abstract: This paper uses pre‐offer market valuations to evaluate the misvaluation and Q theories of takeovers. Bidder and target valuations (price‐to‐book, or price‐to‐residual‐income‐model‐value) are related to means of payment, mode of acquisition, premia, target hostility, offer success, and bidder and target announcement‐period returns. The evidence is broadly consistent with both hypotheses. The evidence for the Q hypothesis is stronger in the pre‐1990 period than in the 1990–2000 period, whereas the evidence for the misvaluation hypothesis is stronger in the 1990–2000 period than in the pre‐1990 period.

Date: 2006
References: Add references at CitEc
Citations: View citations in EconPapers (190) Track citations by RSS feed

Downloads: (external link)
https://doi.org/10.1111/j.1540-6261.2006.00853.x

Related works:
Working Paper: Does Investor Misvaluation Drive the Takeover Market? (2004) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:jfinan:v:61:y:2006:i:2:p:725-762

Ordering information: This journal article can be ordered from
http://www.afajof.org/membership/join.asp

Access Statistics for this article

More articles in Journal of Finance from American Finance Association Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().

 
Page updated 2019-10-18
Handle: RePEc:bla:jfinan:v:61:y:2006:i:2:p:725-762