Corporate Restructuring Involving Real Estate Assets: Some Earnings and Risk Signal Implications
Changes in common stockholder wealth when companies announce purchases and sales of real estate assets may result from changing investor perceptions about the risk, timing and/or amount of future cash flows. The evidence suggests that neither sellers nor buyers experience changes in firm risk for these transactions. However, sellers experience positive cash flow changes in the announcement year while buyers experience positive cash flow changes in the following year. Finally, for one-time purchasers, our study provides evidence that the lower the earnings performance compared with expectations in the announcement year, the greater the prediction errors.
Volume (Year): 8 (1993)
Issue (Month): 4 ()
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- Dann, Larry Y. & Masulis, Ronald W. & Mayers, David, 1991. "Repurchase tender offers and earnings information," Journal of Accounting and Economics, Elsevier, vol. 14(3), pages 217-251, September.
- Brooks, LeRoy D & Buckmaster, Dale A, 1976. "Further Evidence on the Time Series Properties of Accounting Income," Journal of Finance, American Finance Association, vol. 31(5), pages 1359-73, December.
- Hays, Patrick A. & Upton, David E., 1986. "A Shifting Regimes Approach to the Stationarity of the Market Model Parameters of Individual Securities," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 21(03), pages 307-321, September.
- Ball, Ray & Watts, Ross, 1972. "Some Time Series Properties of Accounting Income," Journal of Finance, American Finance Association, vol. 27(3), pages 663-81, June.
- John L. Glascock & Wallace N. Davidson & C. F. Sirmans, 1991. "The Gains from Corporate Selloffs: The Case of Real Estate Assets," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 19(4), pages 567-582.
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