The Timing and Consequences of Seasoned Equity Offerings: A Regression Discontinuity Approach
Speaker: Dr. Shuran Zhang (Jinan University)
Topic: |
The Timing and Consequences of Seasoned Equity Offerings: A Regression Discontinuity Approach |
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Time&Date: |
12:00-13:00 pm, 2019/2/27 (Wednesday) |
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Venue: |
Room 619, Teaching A |
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Speaker: |
Dr. Shuran Zhang (Jinan University) |
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Abstract: | The likelihood of seasoned equity offerings (SEOs) jumps discontinuously when the stock price equals the most recent equity offer price. Using a fuzzy regression discontinuity design around this cutoff, which exploits local randomness in stock prices, we investigate the consequences of market timing in SEOs. We find significant increases in cash holdings, executive compensation, and acquisitions of lower quality, with no real effects on investment or employment. Overall, we provide some of the cleanest estimates, to date, of the determinants and causal effects of market timing in SEOs. |