What drives the market value of firms in the defense industry?

Gunther Capelle-Blancard and Nicolas Couderc ()
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Nicolas Couderc: CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique

Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) from HAL

Abstract: This paper investigates the relative importance of different types of news in driving significant stock price changes of firms in the defense industry. We implement a systematic event study with a sample of the 58 largest publicly listed companies in the defense industry, over the time period 1995-2005. We first identify, for each firm, the statistically significant abnormal returns over the time period, and then we look for information releases likely to cause such stock price movements. We find that stock price movements in the defense industry are, in many ways, influenced by the same events as in other industries (key role of formal earnings announcements or analysts' recommendations) but this industry also has some specific features, in particular the influence of geopolitical events and the relevance and frequency of bids and contracts on stock prices.

Keywords: GARCH models; information releases; defense industry; financial markets; Event study; marchés financiers; secteur de la Défense; publication d'informations; modèles GARCH; Etude d'évènements (search for similar items in EconPapers)
Date: 2006-04
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00115655
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Published in 2006

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Related works:
Journal Article: What drives the market value of firms in the defense industry (2008)
Working Paper: What drives the market value of firms in the defense industry? (2008)
Working Paper: What drives the market value of firms in the defense industry? (2008)
Working Paper: What drives the market value of firms in the defense industry? (2006)
Working Paper: What drives the market value of firms in the Defense industry? (2006)
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