Download or read book Relationship Between Firm Value and Long Term Debt written by Azhar Uddin and published by . This book was released on 2017 with total page 220 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The COVID 19 Impact on Corporate Leverage and Financial Fragility written by Sharjil M. Haque and published by International Monetary Fund. This book was released on 2021-11-05 with total page 51 pages. Available in PDF, EPUB and Kindle. Book excerpt: We study the impact of the COVID-19 recession on capital structure of publicly listed U.S. firms. Our estimates suggest leverage (Net Debt/Asset) decreased by 5.3 percentage points from the pre-shock mean of 19.6 percent, while debt maturity increased moderately. This de-leveraging effect is stronger for firms exposed to significant rollover risk, while firms whose businesses were most vulnerable to social distancing did not reduce leverage. We rationalize our evidence through a structural model of firm value that shows lower expected growth rate and higher volatility of cash flows following COVID-19 reduced optimal levels of corporate leverage. Model-implied optimal leverage indicates firms which did not de-lever became over-leveraged. We find default probability deteriorates most in large, over-leveraged firms and those that were stressed pre-COVID. Additional stress tests predict value of these firms will be less than one standard deviation away from default if cash flows decline by 20 percent.
Download or read book Acces to Long Term Debt and Effects on Firms Performance written by Fidel Jaramillo and published by World Bank Publications. This book was released on 1997 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Debt Maturity and Corporate Capital Structure written by Don Hamson and published by . This book was released on 1990 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Capital Structure and Corporate Financing Decisions written by H. Kent Baker and published by John Wiley & Sons. This book was released on 2011-03-31 with total page 504 pages. Available in PDF, EPUB and Kindle. Book excerpt: A comprehensive guide to making better capital structure and corporate financing decisions in today's dynamic business environment Given the dramatic changes that have recently occurred in the economy, the topic of capital structure and corporate financing decisions is critically important. The fact is that firms need to constantly revisit their portfolio of debt, equity, and hybrid securities to finance assets, operations, and future growth. Capital Structure and Corporate Financing Decisions provides an in-depth examination of critical capital structure topics, including discussions of basic capital structure components, key theories and practices, and practical application in an increasingly complex corporate world. Throughout, the book emphasizes how a sound capital structure simultaneously minimizes the firm's cost of capital and maximizes the value to shareholders. Offers a strategic focus that allows you to understand how financing decisions relates to a firm's overall corporate policy Consists of contributed chapters from both academics and experienced professionals, offering a variety of perspectives and a rich interplay of ideas Contains information from survey research describing actual financial practices of firms This valuable resource takes a practical approach to capital structure by discussing why various theories make sense and how firms use them to solve problems and create wealth. In the wake of the recent financial crisis, the insights found here are essential to excelling in today's volatile business environment.
Download or read book Financial Structure and Economic Growth written by Aslı Demirgüç-Kunt and published by MIT Press. This book was released on 2001 with total page 452 pages. Available in PDF, EPUB and Kindle. Book excerpt: CD-ROM contains: World Bank data.
Download or read book Seasoned Equity Offerings and Their Impact on the Firm Value written by and published by . This book was released on with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The literature about capital structure is very dense but this density does not lead to establish a clear relation between capital structure and firm value. The seminal work of Modigliani and Miller (1958) states that under perfect market conditions, the capital structure choices are irrelevant to the firm value. This proposition cannot hold when market frictions are introduced in the analysis. From a theoretical standpoint, two main streams of models can be distinguished. First, trade-off models examine the existence of an optimal repartition between debt and equity. They are based on the hypothesis that the cash flows cannot be fully and symmetrically returned to every investors' type because of bankruptcy costs, corporate and individual taxes and characteristics of the output market (level of competition, production techniques and product specificities). Under these circumstances, firms can gain value in managing their capital structure. The repartition between debt and equity is said to be optimal when it maximises the firm value. However, this relation remains difficult to test empirically. The second theoretical stream is based on the hypothesis that market frictions prevent individual investors and market intermediaries to re-design efficiently and costlessly any financial assets. Therefore, firms have an incentive to issue specific securities to minimise the market imperfections impact on their value. Information asymmetry, agency costs, timing, flotation methods and underwriter's certification become the main determinants of the capital structure choices and they are better suited to explain the impact of these choices on the firm value. Unfortunately, the empirical literature lacks to clearly relate explanatory variables to the theory they should refer to. The dissertation proposes two empirical studies that examine the relation between equity financing and firm value, one at the announcement of the equity offering, the other over a long-term horizon. One c.
Download or read book Long term Debt Value Bond Covenants and Optimal Capital Structure written by Hayne E. Leland and published by . This book was released on 1993 with total page 58 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Maturity Structure of Debt written by Fabio Schiantarelli and published by World Bank Publications. This book was released on 1997 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Debt Maturity Choice and Firms Investment written by Yongjin Kim and published by . This book was released on 2017 with total page 66 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study revisits the relation between firms' choices of debt maturity and their investment in a dynamic world. Prior research, including Myers (1977), suggests that financing with short-term debt resolves the underinvestment problem caused by debt financing. In contrast, I establish that short-term debt can reduce the incentive to invest due to larger exposure to default risk from more frequent debt rollovers. Long-term debt, however, is more subject to illiquidity costs, so firms find optimal maturity by balancing these opposing forces. For the firm with average investment and financing, the agency cost arising from the underinvestment is 0.77% of firm value. This suggests that previous studies overestimate the cost by ignoring firms' flexibility in choosing maturity. I also measure firm-specific agency costs using likelihood-based structural estimation. The measured agency costs show significant cross-sectional variation due to heterogeneity in firm characteristics and convexity of the agency costs. The economy-wide average of the costs is 7.28%, which is considerably higher than the cost for the average firm.
Download or read book Hedge Fund Activism written by Alon Brav and published by Now Publishers Inc. This book was released on 2010 with total page 76 pages. Available in PDF, EPUB and Kindle. Book excerpt: Hedge Fund Activism begins with a brief outline of the research literature and describes datasets on hedge fund activism.
Download or read book Determinants of Capital Structure written by Muhammad Islam and published by LAP Lambert Academic Publishing. This book was released on 2013 with total page 80 pages. Available in PDF, EPUB and Kindle. Book excerpt: The purpose of this research is to investigate various factors affecting Earning per Share and Return on Capital Employed. In this study an attempt has been made to determine what factors can affect firm value or not?. Different theorists argue differently regarding components of capital structure such as debt, equity and preferred stock on firm value. In this study this relationship has been empirically evidenced in the sugar industry companies listed on Lahore Stock Exchange. This study investigates the relationship of Short Term Debt, Long Term Debt, Equity, Firm Size and Tangibility of Assets with Earning per Share (EPS) and Return on Capital Employed (ROCE) using Simple and Multi Linear Regression Models. The data that has been collected from financial statement of companies related to sugar industry of Pakistan listed on Lahore Stock Exchange.
Download or read book Corporate Capital Structures in the United States written by Benjamin M. Friedman and published by University of Chicago Press. This book was released on 2009-05-15 with total page 404 pages. Available in PDF, EPUB and Kindle. Book excerpt: The research reported in this volume represents the second stage of a wide-ranging National Bureau of Economic Research effort to investigate "The Changing Role of Debt and Equity in Financing U.S. Capital Formation." The first group of studies sponsored under this project, which have been published individually and summarized in a 1982 volume bearing the same title (Friedman 1982), addressed several key issues relevant to corporate sector behavior along with such other aspects of the evolving financial underpinnings of U.S. capital formation as household saving incentives, international capital flows, and government debt management. In the project's second series of studies, presented at the National Bureau of Economic Research conference in January 1983 and published here for the first time along with commentaries from that conference, the central focus is the financial side of capital formation undertaken by the U.S. corporate business sector. At the same time, because corporations' securities must be held, a parallel focus is on the behavior of the markets that price these claims.
Download or read book Fiscal Sustainability in Theory and Practice written by Craig Burnside and published by World Bank Publications. This book was released on 2005 with total page 312 pages. Available in PDF, EPUB and Kindle. Book excerpt: Topics discussed in this publication include: an introduction to theoretical and practical aspects of fiscal sustainability; theoretical prerequisites for fiscal sustainability analysis; debt indicators in the measurement of vulnerability; cyclical adjustment of budget surplus; pro-cyclical fiscal policy using Mexico's fiscal accounts as a case study; fiscal rules and the experience of Chile; currency crises and models for deal with financing costs.
Download or read book Capital Structure written by Ahmed Riahi-Belkaoui and published by Praeger. This book was released on 1999-02-28 with total page 238 pages. Available in PDF, EPUB and Kindle. Book excerpt: This text uses theoretical and contingency approaches to examine the question of whether capital structure can be determined. Using a bond rating model it looks at the evaluation of capital structure, the resolution of issues pertaining to equity and liabilities, and their contribution to reports
Download or read book The Debt equity Choice written by Ronald W. Masulis and published by . This book was released on 1988 with total page 168 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Capital Structure Cash Holdings and Firm Value written by João Caldeira and published by . This book was released on 2014 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study analyzed the relationship between capital structure, cash holdings and firm value for a sample of publicly traded Brazilian firms, using panel data regressions, employing the fixed-effects estimator. Initially, regressions between capital structure (debt to total capital) and cash holdings (cash to assets), as well as between cash holdings and short and long term debt, were estimated. Next, a model between firm value, capital structure and cash holding was employed. The results of this study suggest that debt, both short and long termed, is negatively related to cash holdings, and that the level of cash holdings is also associated to a lower leverage. The study also presented indirect evidence that financially constrained firms hold more cash. With respect to the impact of the capital structure and cash holdings in the firm value, both short and long-term debt had negative marginal effects on the market value of equity, as well as the financial constraint, suggesting a risk-averse behavior of investors with respect to debt. Cash holdings, instead, is valued as positive by investors, but up to an optimum threshold level. Further from that point, the market capitalization is discounted with respect to cash holdings (inverted U-curve), in synergy with static trade-off theory of cash holdings.
