STOCK REPURCHASE ANNOUNCEMENTS AND STOCK PRICES EVIDENCE FROM TAIWAN

Lin Li-Hua, Szu-Hsien Lin and Ya-Chiu Angela Liu

The International Journal of Business and Finance Research, 2011, vol. 5, issue 1, 1-12

Abstract: This paper uses an event study methodology to examine the stock price behavior surrounding announcements of stock repurchases made by Taiwan firms from 2000 to 2008. Our analysis shows that stock prices go up in response to stock repurchase announcements. We also find the announcement effects between various industries to be significantly different; the announcement effect is greatest in the financial industry and least in the electronics industry. Finally, firms which fully executed stock repurchases were confirmed to have experienced a relatively large stock price decline in the pre-announcement period compared with those which executed less than 10% stock repurchases; however, there is no significant difference in their announcement effects.

Keywords: Stock repurchases; event study; abnormal return; cumulative abnormal return (search for similar items in EconPapers)
JEL-codes: G14 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (1)

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