scholarly journals A Multi-Country Study of Factors Affecting Credit Ratings Revisions

2021 ◽  
Vol 21 (3) ◽  
pp. 1424-1443
Author(s):  
Angeline Siew-Huan Ng ◽  
Mohamed Ariff Syed Mohamed
Keyword(s):  
Stock Prices ◽  
Stock Price ◽  
Credit Rating ◽  
Price Changes ◽  
Factors Affecting ◽  
Listed Firms ◽  
New Findings ◽  
Specific Factors ◽  
Rating Changes ◽  
Corporate Credit Rating

This paper reveals findings from extending corporate credit rating studies towards (i) new ratings, affirmation, confirmation, watchlists, and withdrawal, which together represent five out of eight rating types yet to be studied rigorously (there are several papers on upgrades and downgrades); and (ii) identifying key firm-specific factors affecting stock prices around the rating revisions in markets not yet studied. The firmspecific factor effects are measured using the Ordered Probit methodology. Results show that investment and speculation grade issues have the most pronounced effects on price changes. Further findings are: interest-coverage, profitability and leverage ratios, all of which stand out as the most relevant firm-specific factors correlated with stock price changes. An interesting new finding is the discovery of corruption perception scores as a new measure is significantly influencing affirmation, confirmation and downgrade ratings. These new findings are likely to be of interest to investors, corporations wanting to know rating change effects and the external regulators concerned with financial weaknesses/strengths of listed firms facing rating changes.

scholarly journals Impacts of credit rating changes on stock returns

2020 ◽  
Vol 2 (1) ◽  
Author(s):  
Pham Quynh Chau ◽  
Nguyen Thu Hien
Keyword(s):  
Market Efficiency ◽  
Stock Returns ◽  
Stock Prices ◽  
Credit Rating ◽  
Credit Ratings ◽  
Stock Exchanges ◽  
Listed Firms ◽  
Stock Market Efficiency ◽  
Rating Changes ◽  
The Impact

This paper studies the impact of credit ratings issued by CIC, a Vietnamese local rating agency, on stock returns of listed companies on the Vietnamese stock exchanges in the period of 2007-2010. The findings of the study confirm the assertions of the previous researches by Holthausen and Leftwich (1986), Hand, Holthausen and Leftwich (1992), Chan and Poor (2008). Specifically, CIC’s credit ratings slightly affect the stock prices of the listed firms, an evidence supporting CIC’s role and its rating quality to a certain extent. This paper also confirms semi-strong form of the Vietnamese stock market efficiency.

scholarly journals Impact of Sovereign Debt Credit Rating Revision on Banking Industry: Evidence from G7 Countries

2019 ◽  
Vol 8 (2) ◽  
pp. 85-100
Author(s):  
Reza Tahmoorespour ◽  
Mohamed Ariff ◽  
Alireza Zarei
Keyword(s):  
Sovereign Debt ◽  
Credit Rating ◽  
Banking Industry ◽  
Information Leakage ◽  
Market Prices ◽  
New Findings ◽  
Price Effects ◽  
Study Methodology ◽  
Rating Changes ◽  
Event Study Methodology

Abstract The aim of this study is to identify the economic impacts on G7 banking industry when sovereign rating is revised. We used event study methodology (t-statistics) and found that sovereign rating changes significantly affect share market prices. It seems that there is information leakage prior to sovereign rating announcement dates as released by the S&P: there are some negative price effects as well on mixed-type rating change effects, such as ‘rating watch’ announcements. These are new findings that may help to extend the sovereign rating literature in terms of findings from multiple countries, and on sustainability of debt taking.

scholarly journals PENGARUH VARIABEL AKUNTANSI TERHADAPPERUBAHAN HARGA SAHAM PERUSAHAAN YANG GO PUBLIC DI BURSA EFEK JAKARTA

2016 ◽  
Vol 5 (1) ◽  
pp. 1
Author(s):  
Setyaningsih Setyaningsih
Keyword(s):  
Stock Prices ◽  
Random Sampling ◽  
Stock Price ◽  
Stock Exchange ◽  
Financial Accounting ◽  
Study Analysis ◽  
Price Changes ◽  
Leverage Ratio ◽  
Independent Variables ◽  
The Relationship

The objective of this study is to investigate the relationship between accounting variables and stock price changes in Jakarta Stock Exchange (JSX). Some accounting variables in this study are devidend payout  ratio, assets size, assets growth , leverage ratio, variability in earning and covariability in earning as independent variables, the independent variables are stock  price changes. The study analysis 80 cases of active firms  in  the period of 1994 to 1997.  Data is collected by means of purpo sive random sampling. Regression analysis is used to analyse the data.The  result  of  the study  shows  that  there  is significant  affect  of  the  sevent financial accounting informations in the model as predictor of stock price changes (Y); there are two variables to be dropped because there is multicolinierity among variables. Those variables are leverage ratio (X5) and covariability in earning (X7) . There are five other independent variables affect significantly to stock prices changes (Y), which their contribution is 49%.

Pharmaceutical R&D Spending and Threats of Price Regulation

2009 ◽  
Vol 45 (1) ◽  
pp. 239-264 ◽  
Author(s):  
Joseph Golec ◽  
Shantaram Hegde ◽  
John A. Vernon
Keyword(s):  
Stock Prices ◽  
Stock Price ◽  
Natural Experiment ◽  
Price Regulation ◽  
Negative Effects ◽  
Firm Level ◽  
Cross Sectional ◽  
Price Changes ◽  
Health Security ◽  
Pharmaceutical Price

AbstractDo threats of pharmaceutical price regulation affect subsequent research and development (R&D) spending? This study uses the Clinton administration’s Health Security Act (HSA) of 1993 as a natural experiment to study this issue. We link events surrounding the HSA to pharmaceutical stock price changes and then examine the cross-sectional relation between firms’ stock price changes and their subsequent unexpected R&D spending changes. Results show that the HSA had significant negative effects on stock prices and firm-level R&D spending. Conservatively, the HSA reduced R&D spending by about $1 billion even though it never became law.

scholarly journals Analysis Of Factors Affecting the Value Of Manufacturing Industry Companies in the Indonesian Stock Exchange (IDX)

2020 ◽  
Vol 5 (1) ◽  
Author(s):  
Javindri Yoseph Renaldi ◽  
Dahlia Br. Pinem ◽  
Yul Tito Permadhy
Keyword(s):  
Stock Prices ◽  
Firm Value ◽  
Stock Price ◽  
Manufacturing Industry ◽  
Dividend Policy ◽  
Stock Exchange ◽  
Secondary Data ◽  
Sample Collection ◽  
Factors Affecting ◽  
Research Population

The purpose of this research is conducted to analyze factors the extent of influence (Liquidity - CR), (Leverage - DER), and (Dividend Policy - DPR) that can occur with (Firm Value - PBV). Manufacturing Industry Company was chosen because of fluctuations in stock prices that surged from the Composite Stock Price Index. The theory used is the signaling theory, trade-off theory, and dividend policy theory. The data used are secondary data with a sample collection method using purposive sampling. Where the research population is used is manufacturing industry companies listed on the Indonesia Stock Exchange (BEI) 2016-2018 observation period a number of 157 companies, with the final sample of this research obtained 34 selected companies that became the sample criteria. Data analysis techniques were performed using descriptive statistics and panel data regression analysis, with the help of the application E-views version 9.0 and Microsoft Excel 2013. The results of the research partially revealed that the variable (Leverage - DER) had an influence on (Firm Value - PBV) while the variable (Liquidity - CR) and (Dividend Policy - DPR) have no influence on Firm Value. And the independent variables affect the dependent variable by 16.64%. 

scholarly journals Investigating the Effects of Dividends Pay-out on Stock Prices and Traded Equity Volumes of BSE Listed Firms

2015 ◽  
Vol 1 (4) ◽  
pp. 24-37 ◽  
Author(s):  
Ishmael Radikoko ◽  
Emmanuel Ndjadingwe
Keyword(s):  
Stock Prices ◽  
Firm Value ◽  
Stock Price ◽  
Direct Relationship ◽  
Stock Exchange ◽  
Sampling Technique ◽  
Optimal Time ◽  
Listed Firms ◽  
Year Effect ◽  
Quota Sampling

The main objective of this study is to examine the effect of dividend pay-out on the prices of stock in Botswana’s equity market as well as the effect of traded volumes of such stocks. Other objectives of the research are to determine the optimal pay-out ratio based on the profits of the firm and to determine the optimal time to declare and pay dividends. We use quota-sampling technique and selected 5 companies from the 22 domestic listed companies in the Botswana Stock Exchange. The companies under consideration are Barclay Bank, RDCP, Chobe, Engen and Sefalana Plcs. These companies are chosen based on the availability of daily closing trading information for the past five years and easiness to get information to use for our study that includes dividends pay-outs, profits made, volumes traded, etc. The result of this study reveals that there is a direct relationship between dividend announcement, ex-dividends, dividend pay-out ratio and volume of stock traded and the stock price in Botswana. Furthermore, the study concludes that there is a direct relationship between change in dividends and change in dividend per share. Lastly, the finding reveals that most of the companies sampled pay dividends between December and March. We recommend that companies should have an optimal dividend policy as this have been proven to increase firm value. We also recommend that firms should announce dividends around December to March to counter the end of year effect that usually suppresses stock prices.

scholarly journals High volume trades and stock price changes in Brazil

2013 ◽  
Vol 11 (1) ◽  
pp. 92-101
Author(s):  
Andre Carvalhal ◽  
Cesar Martins ◽  
Otavio Figueiredo
Keyword(s):  
Institutional Investors ◽  
Stock Prices ◽  
Stock Price ◽  
High Volume ◽  
International Studies ◽  
Significant Relation ◽  
Price Changes ◽  
Available Information

This work analyzes the relation between stock price changes and high volume trades in Brazil. Using a unique intra-day database, we evaluate 10 of the most liquid shares from 2001 to 2006. Unlike most international studies, which are based on data from funds or institutional investors, this article breaks new ground by working with publicly available information. Our results indicate a positive and significant relation between stock price changes and high volume trades. In line with existing literature, we show there are both temporary and partially permanent on stock prices after high volume trades. Our study also indicates the existence of asymmetry between purchases and sales.

The Regulatory Role of Credit Ratings and Voluntary Disclosure

2021 ◽  
Author(s):  
Riddha Basu ◽  
James P. Naughton ◽  
Clare Wang
Keyword(s):  
Voluntary Disclosure ◽  
Credit Rating ◽  
Credit Ratings ◽  
Regulatory Role ◽  
Rating Agencies ◽  
Corporate Credit ◽  
Quasi Experimental ◽  
Rating Changes ◽  
Corporate Credit Rating

We find that corporate credit rating changes have an effect on firms' voluntary disclosure behavior that is independent of the information they convey about firm fundamentals. Our analyses exploit two separate quasi-experimental settings that generate either exogenous credit rating downgrades or credit rating upgrades (i.e., credit rating label changes). We find evidence of a negative relation between the direction of the credit rating label change and the provision of voluntary disclosure in both settings-firms respond to exogenous downgrades by increasing voluntary disclosure and to exogenous upgrades by decreasing voluntary disclosure. The effects we document are attributable to the regulatory role rather than the information role of credit ratings. Overall, our analyses indicate that credit rating agencies as gatekeepers influence firms' provision of voluntary disclosure.

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