Resource title

Is the event study methodology useful for merger analysis? A comparison of stock market and accounting data

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Resource description

This paper presents empirical evidence about the ability of event studies to capture mergers' ex-post profitability as measured by accounting data. We use a sample of large horizontal concentrations during the period 1990-2002 involving 482 firms either as merging firms or competitors, and contrast a measure of the mergers' profitability based on stock market event studies with one based on balance sheet profit data. We show that using a long window around the announcement date (25 or 50 days before the event) increases the ability to capture the ex-post merger effect: the pairwise correlation coefficient is positive and highly significant.(author's abstract)

Resource author

Tomaso Duso, Klaus Gugler, B. Burcin Yurtoglu

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Resource publish date

Resource language

en

Resource content type

application/pdf

Resource resource URL

http://epub.wu.ac.at/3026/3/IRLE%2DD%2D08%2D00006_revision_21_1_2010%2D3.pdf

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Adapt according to the license agreement. Always reference the original source and author.