Research output: Contribution to Journal/Magazine › Journal article › peer-review
Research output: Contribution to Journal/Magazine › Journal article › peer-review
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TY - JOUR
T1 - The option and decision to repurchase stock
AU - Sonika, Rohit
AU - Carline, Nicholas
AU - Shackleton, Mark
PY - 2014
Y1 - 2014
N2 - Open market repurchase programs provide firms with the flexibility to manage the cash and risk aspects of their operations. This paper therefore aims to determine whether cash and risk matter only at the implementation stage in the sequence of a repurchase program: announcement, implementation, and withdrawal. We do find that temporary cash and risk measures only affect the implementation decision, while partially negating the traditional signaling effect around program announcement. The relevance of the flexibility afforded by the early announcement of a repurchase program is also evidenced by a steadily increasing time-to-event probability of repurchase implementation and program withdrawal.
AB - Open market repurchase programs provide firms with the flexibility to manage the cash and risk aspects of their operations. This paper therefore aims to determine whether cash and risk matter only at the implementation stage in the sequence of a repurchase program: announcement, implementation, and withdrawal. We do find that temporary cash and risk measures only affect the implementation decision, while partially negating the traditional signaling effect around program announcement. The relevance of the flexibility afforded by the early announcement of a repurchase program is also evidenced by a steadily increasing time-to-event probability of repurchase implementation and program withdrawal.
U2 - 10.1111/fima.12054
DO - 10.1111/fima.12054
M3 - Journal article
VL - 43
SP - 833
EP - 855
JO - Financial Management
JF - Financial Management
SN - 0046-3892
IS - 4
ER -