Earnings management and stock performance of reverse leveraged buyouts

De Wai Chou, Michael Gombola, Feng Ying Liu

研究成果: 雜誌貢獻文章

34 引文 斯高帕斯(Scopus)

摘要

This study provides further evidence of earnings management around security offerings. We find positive and significant discretionary current accruals coincident with offerings of reverse LBOs. Issuers in the most aggressive quartile of earnings management have a one-year aftermarket return that is between 15% and 25% less than the most conservative quartile. We also find a negative and significant relation between abnormal accruals and post-issue abnormal returns within the first year after the offering. The relation remains after controlling for book-to-market ratio, firm size, offering size, and involvement of buyout specialists or management. Although earnings management has been used to explain post-issue long-term underperformance of IPOs and SEOs, our study shows that earnings management can explain post-offering returns of reverse LBOs, even in the absence of post-offering underperformance.

原文英語
頁(從 - 到)407-438
頁數32
期刊Journal of Financial and Quantitative Analysis
41
發行號2
DOIs
出版狀態已發佈 - 2006 六月 1

    指紋

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics

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