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Repurchases and intended program length

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  • Gould, Graeme P.

Abstract

This paper examines whether a relationship between the intended duration specified in an on-market repurchase announcement and completion rates exists. A key finding is that intended program length is negatively correlated with completion rates, suggesting that firms are more committed to follow thru with their repurchase targets the shorter the period of time indicated in an announcement. Further, intended program length is negatively related with announcement returns, particularly so for firms that are likely to be mispriced, suggesting that the share market considers the announcing firm as more credible the shorter the period of time indicated.

Suggested Citation

  • Gould, Graeme P., 2019. "Repurchases and intended program length," Pacific-Basin Finance Journal, Elsevier, vol. 56(C), pages 234-247.
    • Handle: RePEc:eee:pacfin:v:56:y:2019:i:c:p:234-247
    DOI: 10.1016/j.pacfin.2019.05.011
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    References listed on IDEAS

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    Cited by:

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    2. Feng, Yitian, 2023. "Do listed companies fulfill their public commitments? Evidence from the stake-raising commitments of Chinese companies," Pacific-Basin Finance Journal, Elsevier, vol. 77(C).

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    More about this item

    Keywords

    Repurchases; Program duration; Undervaluation; Completion rates; Announcement CAR;
    All these keywords.

    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G35 - Financial Economics - - Corporate Finance and Governance - - - Payout Policy

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