Equities issues and long-term firm’s performances in Tunisian stock market

Hatem Mansali () and Wissem Daadaa
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Hatem Mansali: IRG - Institut de Recherche en Gestion - UPEM - Université Paris-Est Marne-la-Vallée - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12
Wissem Daadaa: FSEG Tunis El Manar - FSEGT Tunisia

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Abstract: This paper investigates the long-run performance of seasoned equity offering (SEO) firms in Tunisia. We use event time and calendar time approach to measure the long-run performance of SEO firms. The results suggest that SEO firms underperform in the long-run, and this underperformance is robust according to alternative measures. In the cross-section, we show that the runup, market runup and the proceeds from SEO are significant determinants of the underperformance of SEO firms. These results are in accordance with both behavioural theories and real options theory. To distinguish between these two theories, we analyse the average systematic risk dynamics around SEO. The results suggest that there is an increase in risk before the offering, and a significant decrease of risk after the offering. The behaviour of risk around SEO appears consistent with real options predictions.

Date: 2018-04-05
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Published in International Journal of Managerial and Financial Accounting, 2018, 10 (1), ⟨10.1504/IJMFA.2018.091074⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02003063

DOI: 10.1504/IJMFA.2018.091074

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