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Center for Financial Studies (CFS), Universität Frankfurt a. M. >
CFS Working Paper Series, Universität Frankfurt a. M. >
Please use this identifier to cite or link to this item:
http://hdl.handle.net/10419/57340
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| Title: | | Do firms buy their stock at bargain prices? Evidence from actual stock repurchase disclosure  |
| Authors: | | Ben-Rephael, Azi Oded, Jacob Wohl, Avi |
| Issue Date: | | 2011 |
| Series/Report no.: | | CFS Working Paper 2011/17 |
| Abstract: | | We use new data from SEC filings to investigate how S&P 500 firms execute their open market repurchase programs. We find that smaller S&P 500 firms repurchase less frequently than larger firms, and at a price which is significantly lower than the average market price. Their repurchase activity is followed by a positive and significant abnormal return which lasts up to three months after the repurchase. These findings do not hold for large S&P 500 firms. Our interpretation is that small firms repurchase strategically, whereas the repurchase activity of large firms is more focused on the disbursement of free cash. |
| Subjects: | | Stock Repurchases Stock Buybacks Payout Policy Timing Bid-Ask Spread Liquidity |
| JEL: | | G14 G30 G35 |
| Persistent Identifier of the first edition: | | urn:nbn:de:hebis:30-115334 |
| Document Type: | | Working Paper |
| Appears in Collections: | | CFS Working Paper Series, Universität Frankfurt a. M.
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