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STOCK REPURCHASES AND SECURITYHOLDER RETURNS: A CASE STUDY OF TELEDYNE
Author(s) -
Wansley James W.,
Fayez Elayan
Publication year - 1986
Publication title -
journal of financial research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.319
H-Index - 49
eISSN - 1475-6803
pISSN - 0270-2592
DOI - 10.1111/j.1475-6803.1986.tb00447.x
Subject(s) - stock (firearms) , shareholder , business , common stock , monetary economics , corporation , excess return , financial system , economics , finance , corporate governance , geography , context (archaeology) , archaeology
This study examines securityholder returns around nine major repurchase announcements and 10 other repurchase‐related announcements by the Teledyne Corporation between 1972 and 1984. Statistically significant positive excess returns to common stock and convertible preferred stockholders are documented. Contrary to prior research that investigated the average response to repurchase announcements, however, there is a wealth transfer from bondholders to stockholders. Bondholder returns around the repurchase announcements are significantly negative. These returns are examined for each announcement and each bond issue.