金融学专业外文翻译-----市场上发行可转换债券的反应

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1、 本科毕业论文外文翻译原 文 外文题目： Market reaction on convertible bonds offering： An a gency cost of free cash flow perspective 出 处： 2008年 第 2期 作 者： LI Xiao-jun ， WANG Ping xin 原 文 ： Market reaction on convertible bonds offering： An a gency cost of free cash flow perspective LI Xiao-jun ， WANG Ping xin （ 1 School

2、 o Management， Xi an Jiaotong Universio； Xi an 710049 China；2 School ofFinance and Economics， Hangzhou Dianzi UniversiO,HangJou 310018，China） ABSTRACT By investigating “announcement effects”of 48 CBS and 439 pure equity offering in Chinese Ashare listed companies， this paper finds that， in general，

3、convertible bonds issue announcement may elicit a negative stock price response， firms with convertible bonds issue announcement experience significantly higher mean of abnorm al returns than firm s with equity issue announcement， and the fallen stock price is positively related to ofering size， and

4、 negatively related to debt asset ratio Further,we find those firms with less undistributed cash flow and more growth opportunity experience significantly higher price resportse than firms with more undistributed cash flow and less growth opportunity The empirical evidence consists with the predicti

5、ons of the agency costs of free cash flow theory Key words： eventstudy methodology； convertible bonds； agency costs of flee cash flow Introduction Firms making capital structure decisions can choose to issue securities that have both equity and debt components rather than issue pure equity and debt

6、Convertible bonds(CBS)loans share this characteristic Studies of announcement effect with regard to convertible bond issued by companies from the United States confirm the hybrid nature of these finance instruments Smith(1 986) and Eckbo and Masulis(1995) I Dresent overviews of the relevant literatu

7、re which show the following results First， the issuance of new debt is not associated with any significant stock price reaction Second， the issuance of new equity is associated with a significant negative stock price reaction Finally， the issuance of fl CBS that has elements of both debt and equitv

8、is associated with a significantly stock price decline that is smaller than the decline associated with the issuance Of pure equity Some studies of CBS issued by Japanese and Dutch companies howeve show that these events are not associated with significant stock price reaction and that， jn some case

9、s， they are even assoc iated with significantly positive stock price reactions . In this paper we will present empirical evidence on the announcement effects of CBS from China capital market Differ from previous studies， this study extends agency costs theory and posits that sharehOlder determine th

10、eir reaction to equity and CBS issues on firm reputation regarding the abuse of free cash flow The empirical results suggest that firms with CBS ofering announcement experience significantly higher mean of abnormal returns than lirms with eqmty ofering announcement， but in genera1 CBS ofering announ

11、cement may elicit fl negative stock price response The results are consistent with the predictions of the agency costs of free cash flow theory The remainder of this paper is structured as follows The data and event study methodology is included in Section 2 The empirical results are presented in Se

12、ction 3 The summary and conclusions are presented in Section 4 Data and research methodology 2 1 Sample selection W e use the annOuncements of CBS and pure equity that were issued from January 2001 to December 2005 by China Ashares listed companies During this period a total of 48 CBS and 455 equiti

13、es were announced 1 6 equities were eliminated because the completed set of data on the preevent period was not available from China Stock Market&Accounting Research Database(CSMAR) Therefore， we can use 48 announcements of CBS and 439 pure equities 2 2 Research variable To proxy for free cash flow

14、for each firm， following Le hn and Poulson(1 989) 。 we calculated a measure of undistributed cash flow(UCF)for the year immediately precedifig the year of the going announcement issuance This variable is defined as： UCF= INC TAX INTEXPPEDDIV COMDIV Where： INC is the operating income before depreciat

15、ion； TAX is the total income taxes minus the change of deferred taxes from the previous year to the curent year； INTEXP is denotes gross interest expense on shortterm and long。 term debt；PEDDIV means total amount of prefered dividend requirement on cumulative preferred stock and dividends paid on no

16、ncumulative preferred stoc k； COM DIV is the total dollar amount of dividends declared on common stoc k； UCF is standardized by the market value of equity for the same period of getting CF The market value of equity is defined as the market valve of tradeable shares plus the equity of untradeable sh

17、ares To proxy for growth prospects for each firm， we calculate the average annual percent increase in net sales preceding the going announcement issuance Em pirical results 3 1 Announcement efects of growth and free cash flow characteristics We posit that shareh olders will respond more favorably to

18、 CBS and equity issue announcement if management has fl favorable track record To test this hypothesis，we divide 48 CBS and 439 equity sample firms into high undistributed cash flow group and low undistributed cash flow group according to variable CF mean respectively Similarly， according to the mea

19、n of sale growth ratio(SGR)， we can divide sample firms into high growth firm s and low growth firms respectively Since variable CF and SGR are not matching， the whole sample firms are divided into four groups We denote these groups as groups 1(high CF and low growth group)， groups 2 (high CF and high growth group)， groups3(1ow CF and low growth group)and groups 4(1ow CF and high growth group)respectively In Table 2， the announcement effect of convertible bond and pure equity for group I(those with high CF and low growth)and group