| Summary: | 碩士 === 國立虎尾科技大學 === 經營管理研究所 === 96 === In the listed companies on SEC and OTC in Taiwan, we found that a lot of companies have changed their names. Therefore, this paper aims at the motivation, recognition and respond of investors for corporate name changes.
The sample firms that ever had changed names of this study are taken from the Taiwan Economic Journal from 1998 to 2006, and get the reason of corporate name changed from Udndata and KMW. It based on Behavioral Finance, and analyzed the possibility of different reactions of investors’ investment behavior in the bull and bear markets by using event study. In order to find that short-term performance of corporate name changes under each market, there are three causes that affect investors’ investment behavior. First is changing the operation items. Second is merging of companies. Third is pure changing name. In addition, we use average stock price, return on assets, and Tobin’s Q to estimate the long-term performance of corporate name changes. It shows that changing names will have different effects on their returns.
Our results show that name change has significant positive effect in bear market, especially, for those changed their operation items. In bull and flat markets, however, the cumulative average abnormal return didn’t change significantly. For the reason of long-term performance didn’t become better, we found that investors’ investment behavior is irrational, and is also a phenomenon which manipulates the corporate name change.
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