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Restricted Stock Discounts: An Empirical Analysis

Author

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  • McConaughy Daniel L.

    (Department of Finance, Financial Planning and Insurance,California State University Northridge, Northridge, CA91330, USA)

  • Hussein Monica

    (Department of Finance, Financial Planning and Insurance,California State University Northridge, Northridge, CA91330, USA)

  • Dow James P.

    (Department of Finance, Financial Planning and Insurance,California State University Northridge, Northridge, CA91330, USA)

Abstract

Examining 416 transactions over the 1996 to 2013 time period, we find that size, stock price volatility, block size, price-to-revenue, and EBITDA margin are significantly related to restricted stock discounts. We do not find registration rights or the initial holding period to be statistically significantly related to discounts. Our results suggest that simple correlations or sorting of discounts by various criteria do not capture what factors are statistically significantly related to restricted stock discounts in the complex world of private placement deals.

Suggested Citation

  • McConaughy Daniel L. & Hussein Monica & Dow James P., 2019. "Restricted Stock Discounts: An Empirical Analysis," Journal of Business Valuation and Economic Loss Analysis, De Gruyter, vol. 14(1), pages 1-14, February.
    • Handle: RePEc:bpj:jbvela:v:14:y:2019:i:1:p:14:n:1
    DOI: 10.1515/jbvela-2017-0008
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    References listed on IDEAS

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