TY - JOUR
T1 - A Theory of Stock Price Responses to Alternative Corporate Cash Disbursement Methods
T2 - Stock Repurchases and Dividends
AU - OFER, AHARON R.
AU - THAKOR, ANJAN V.
PY - 1987/6
Y1 - 1987/6
N2 - This paper develops a model in which managers can signal their firms' true values by using either a dividend or a stock repurchase or both. The authors explain a number of stylized facts about these cash‐disbursement mechanisms, particularly those concerning the relative magnitudes of stock price responses to dividends and repurchases. Most importantly, they explain why a stock repurchase elicits a significantly higher price response, on average, than a dividend announcement. 1987 The American Finance Association
AB - This paper develops a model in which managers can signal their firms' true values by using either a dividend or a stock repurchase or both. The authors explain a number of stylized facts about these cash‐disbursement mechanisms, particularly those concerning the relative magnitudes of stock price responses to dividends and repurchases. Most importantly, they explain why a stock repurchase elicits a significantly higher price response, on average, than a dividend announcement. 1987 The American Finance Association
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U2 - 10.1111/j.1540-6261.1987.tb02572.x
DO - 10.1111/j.1540-6261.1987.tb02572.x
M3 - Article
AN - SCOPUS:84977715071
SN - 0022-1082
VL - 42
SP - 365
EP - 394
JO - The Journal of Finance
JF - The Journal of Finance
IS - 2
ER -