Does Competitor Equity Issuance Influence Firms' Behavior?

Exploring the link between Corporate Finance and Competition

AV Akademikerverlag (2015-01-26 )

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ISBN-13:: 978-3-639-72942-9
ISBN-10:: 3639729420
EAN:: 9783639729429
Book language:: English
Blurb/Shorttext:: Financing and investment polices of different companies are interlinked through various channels. One of these channels is product market competition, which can make outlier events of equity issuance of a competitor change the policies of a firm. We develop an investment project portfolio model of competition and study a sample of US companies to find that such companies tend to deleverage, underinvest and amass cash – much as we would expect from a firm experiencing an increase in product market competition. Weak competitive position, certain characteristics of the business model, higher operating and financial risk and increased research coverage can strengthen this effect. The choices that the company makes in response closely interrelate and may give an idea of the future returns and performance.
Publishing house:: AV Akademikerverlag
Website:: http://www.akademikerverlag.de/
By (author) :: Aliaksei Mukhachou
Number of pages:: 80
Published at:: 2015-01-26
Stock:: Available
Category:: Economics
Price:: 39.90 €
Keywords:: Competition, strategy, Corporate Finance, Investment, Capital Markets