| Summary: | 碩士 === 亞洲大學 === 財務金融學系碩士在職專班 === 102 === This study aims to find out the effect of financial constraints on short-run and long-run stock price performances after SEO. The study targeted 1,401 SEO events announced by Taiwan OTC and stock market from 1988 to 2013. The empirical results show that corporal financial constraints will have a positive impact on short-run and long-run stock price performances after SEO. In a word, companies with higher financial constraints will enjoy better short-run and long-run stock price performances, and these companies will have positive cumulative average abnormal returns. Moreover, with different variables of financial constraints, the results remain consistent. It means that when companies are short of financial support, it’s better to raise funds by issuing new stocks through SEO, because better investment opportunities increase cash flows, thus result in positive performances on both short-term and long-term stock prices. Among all the controlled variables, company size, insider ownership, information asymmetry and earnings management all have a negative impact on short-run stock price performances; while the proportion of institutional investors and market trend all show a positive impact on short-run stock price performances. In addition, company size, growth opportunity, free cash flow, information asymmetry and earnings management have a negative impact on long-run stock price performances; while the proportion of institutional investor and debt ratio all have a positive impact on long-run stock price performances.
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