| Summary: | 碩士 === 東吳大學 === 會計學系 === 90 === The first purpose of this study is to observe the reactions of Taiwan Stock Exchange listed companies announce to repurchase stock in open market from August 2000 through June 2001, we collect 258 events as samples. Our second purpose is to consider the determinants of actual repurchase. Event study and regression analysis are applied. The major empirical results are summarized below:
Firstly, taking standard event study procedures, the average cumulative abnormal returns(CAR) is positive in event windows. We find the stock price drops before announce, especially for days —6 to —1 prior to announcement. After announcememt of repurchase, stock price raises immediately. Thus, the signaling hypothesis of stock repurchase is supported.
In order to analyse the information contents of repurchase announcement, we use CAR as a dependent variable in regression analysis. Based on our empirical results, unexpected earnings, repurchase share of announcement, and upper amount of repurchase are positively relation to CAR. Thus, the signaling hypothesis of is supported.
Secondly, we find stock return before announcement, stock return after announcement, and repurchase share of announcement are the factors that are associated with actual repurchases. But unexpected cash flows and upper amount of repurchase are not. Stock return before announcement are negatively related actual repurchase. Stock return after announcement and repurchases share of announcement are positively related actual repurchases.
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