Episode Details

In this session, we turn our attention to public announcements other than earnings. We begin by looking at acquisition announcements, establishing that the winners in acquisitions are clearly target company stockholders and that many acquisitions don’t work in delivering value to acquiring company stockholders either at the time of the announcement or in the years after. We look at investment strategies built around acquisitions, with the most lucrative one being the identification of potential target companies ahead of the acquisition announcements. We also look at stock splits, where the evidence of a price reaction is mixed, and dividend announcements, where increases (decreases) in dividends are accompanied by stock price increases (decreases), though the price effect has decreased over time.
Playlist for class (Intro + 42 sessions): https://youtube.com/playlist?list=PLUkh9m2BorqnZGADa8cTzeJblmrZY_SqP&si=zI2pk17pJeld4nWR
Slides: https://www.stern.nyu.edu/~adamodar/pdfiles/invphilslides25/session26.pdf
Post-class test: https://www.stern.nyu.edu/~adamodar/pdfiles/invphilcertificate/postclass/session26test.pdf
Post-class solution: https://www.stern.nyu.edu/~adamodar/pdfiles/invphilcertificate/postclass/session26soln.pdf

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