Work

The Market Reaction to Straight Debt Issues: the Effects of Free Cash Flow

Year: 1998

Type: article

Abstract: In this paper we measure the market reaction to 937 straight debt issues between 1983 and 1993. We find a negative and significant market reaction to a straight debt announcement. In addition, we find that the market reaction to a straight debt issue is directly related to the issuing firm's level of existing cash and inversely related to the issuing firm's investment opportunities.

Source: The Journal of Financial Research

DOI: 10.1111/j.1475-6803.1998.tb00681.x

Authors: Shawn D. Howton, Shelly W. Howton, Steven B. Perfect

Institutions: Drexel University, Villanova University

Language: English

Topic: Corporate Finance and Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: green

OpenAlex ID: W2012779061

FWCI: 5.263

Cites: 16

Cited by: 53

Related to: 10