KEMAMPUAN PASAR MODAL DALAM MENGANTISIPASI KINERJA OPERASIONAL PERUSAHAAN DI MASA DATANG: DALAM KONTEKS EQUITY RIGHT ISSUE DI INDONESIA

Etty Indriani

DOI: https://doi.org/10.23917/benefit.v8i2.1195

Abstract

The study addressed to: (1) investigated the market reaction toward right issue announcement;(2)
gave an empirical evidence of association of stock market reaction with firm’s operational performance in
the future; (3) examined specific variables of right issue s that might explain the reaction of the stock
market at the announcement and the operational performance of firms in the future. Result shows that
the Indonesian stock market gave negative reaction on the third and fourth days after the right issue
announcement. So the stock market had late caught the information. Further, the firms did the right
issue s gained higher operating performance level in the second and third year than average level in the
terms of firm operating performance in the same industry that did not do the right issue . The changes of
firm’s operating performance in the future tend to the positive change. The issue-price was the specific
variable of the right issue that influenced positively on the abnormal return. Meanwhile, the issue-price
negatively affected on the future firm’s operating performance. In the empirical evidence equity right issue
s, the stock market reaction might to anticipate the change of the future firm’s operating performance
through the specific variable issue-price with opposite direction

Keywords

the ability of stocks market; firm’s operational performance; right issue

Full Text:

PDF

References

Ambarish, R., K. John dan J. Williams. (1987). Efficient Signaling with Dividends and Investments. The Journal of Finance, 2: 321-343.

Asquith, P., and David W. Mullins. (1986). Equity Issue and Offering Dilution. Journal of Financial Economics,

: 61-89.

Barclay, Michael J. and Litzenberger, Robert H. (1988). Announcement Effect of New Equity Issues and the

Use of Intraday Prices. Journal of Financial Economics, 21: 71-100.

Fama, E. F. (1970). Efficient Capital Markets: A review of Theory and Empirical Work. Journal of Finance, 25:383-417.

Fowler, D.J., dan C.H. Rorke. (1983). The risk Measurement When Shares are Subjected to Infrequent Trading. Journal of Financial Economics, 12: 279289.

Hartono, J., dan Surianto. (2000). Bias in Beta Values and Its Correction: Empirical Evidence from the Jakarta

Stock Exchange. Gadjah Mada International Journal of Business, 2:337349.

Jensen, M. (1986). Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers. American Economic Review, 76: 323-329.

Kabir, R. and Roosenboom, P. (2003). Can the Stock Market Anticipate Future Operating Performance Evidence from Equity Rights Issues. Journal of Corporate Finance, 9: 93-113.

Kang, H. (1990). Effect of Seasoned Equity Offerings in Korea on Shareholder’s Wealth. Pasific Basic Capital Market Research. S.G. Rhee dan R.P. Chang eds., North Holland, Elsevier Science Publisher B.V., p:265-282.

Kothare, M. (1997). The Effects of equity Issues on Ownership Structure and Stock Liquidity: A Comparison of right and Public Offerings. Journal of Financial Economics, 1: 131-148.

Lee, I., and Loughran, T. (1998). Performance Following Convertible Bond Issuance. Journal of Corporate Finance, 4: 185-207.

Levis, M. (1995). Seasoned Equity Offerings and the Short-and Longrun Performance of Initial Public Offerings in the UK. European Financial Management,

: 125-146.

Loderer, C., and Zimmermann, H. (1988). Stock Offerings in a Different Institutional Setting:

The Swiss Case, 1973 - 1983. Journal of Banking and Finance, 12: 353-378.

Loughran, T., and Ritter, J. (1997). The Operating Performance of Firms Conducting Seasoned Equity Offerings. Journal of Finance, 52: 1823-1850.

Masulis, Ronald W. and Korwar, Ashok N. (1986). Seasoned Equity Offering: An Empirical Investigation. Journal of Financial Economic, 15: 91-118.

Marsh, P. (1979). Equity Right issue and the Efficiency of UK Stock Market. Journal of Finance, September: 835-862.

McLaughin, R., Safieddine, A., and Vasudevan, G. (1996). The Operating Performance of Seasoned Equity

Issuers: Free Cash Flow and Postissue Performance.

Financial Management, 25: 41-53.

Mikkelson, Wayne H. and Partch, Megan M. (1986). Valuation Effects of Security Offerings and the Issuance

Process. Journal of Financial Economics, 15: 31-60.

Myers, Stewart C. and Majluf, Nicholas S. (1984). Corporate Financing and Investment Decisions When Firms Have Information Investor Don’t Have. Journal of Financial Economics, 13: 187-221.

Scholes, M. (1972). The Market for Securities: Substitution vs. Price Pressure and Effects of Information

on Share Prices. Journal of Business, 45: 179-211.

Smith, Clifford W. (1977). Alternative Methods for Raising Capital: Rights versus Underwritten Offerings. Journal of Financial Economics, 5: 273303.

Tsangarakis, N. (1996). Shareholder Wealth Effects of Equity Issues in Emerging Markets: Evidence from Right Offerings in Greece. Financial Management, 25: 21-32.

Article Metrics

Abstract view(s): 42 time(s)
PDF: 16 time(s)

Refbacks

  • There are currently no refbacks.