The Influence on Stock Price and Corporate Performance after Capital Decrease

• Main Authors: Hsin-Yi Huang, 黃馨誼
• Other Authors: none
• Format: Others
• Language: zh-TW
• Published: 2011
• Online Access: http://ndltd.ncl.edu.tw/handle/34244336381458193288

碩士 === 東吳大學 === 企業管理學系 === 99 === The sample firms used in the study are listed companies executing capital reduction by cash and return of paid-in capital for deficit during the period from 2000 to 2008. This study adopts event study method to explore the two kinds of companies with the abnormal changes in stock prices prior to and subsequent to the declaration date of the capital reduction. In addition, two independent samples tests is used for analyzing the difference in the abnormal return between the electronic stock and the non-electronic stock, in the scope of capital reduction, and between the capital reduction by cash and return of paid-in capital for deficit. Finally, it uses mean difference test of pair sample to validate the financial performance subsequent to the capital reduction. The main findings are summarized as follows： Firstly, the announcement on the capital reduction by cash has positive abnormal return rate and accumulated abnormal returns rate in the short term, which means that the announcement effect only lasted for three days. Secondly, the announcement on return of paid-in capital for deficit has a huge negative abnormal return rate and accumulated abnormal returns rate, which means that the investors do not have confidence in these companies. Thirdly, the more scale in capital reduction by cash is, the more positive abnormal return is. Besides, the more scale in return of paid-in capital for deficit is, the more negative abnormal return is; however, the result of statistical testing was not significant. Fourthly, the negative abnormal return on return of paid-in capital for deficit is larger than the positive abnormal return on capital reduction by cash, which means that the Management Level tends to hide the bed news. Finally, the study has founded that the company with return of paid-in capital for deficit can certainly improve the financial performance in ROA, ROE and EPS.