Uppsats

The Signaling Effect of Share Repurchases: Short- and Long-Run Evidence from the Swedish Market

Kandidat-uppsats

Byman, Victor, Håkansson, William

Handelshögskolan i Stockholm/Institutionen för finansiell ekonomi

Publicerad: 2025

Språk: Engelska

Nyckelord

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⌕Abnormal Returns ⌕Share Repurchases ⌕Undervaluation ⌕Underreaction ⌕Market signaling

Sammanfattning

This paper examines 458 open market share repurchase announcements by Swedish firms from 2010 to 2019. Using a cumulative abnormal return (CAR) methodology, we find significant short-run abnormal returns averaging 1.02%, with stronger effects for small firms and value stocks. In the long-run, we observe a one-year average CAR of 8.24%, consistent with the Underreaction Hypothesis (UH) developed by (Ikenberry, Lakonishok, & Vermaelen, 1995). However, results beyond the one-year horizon and across firm characteristics are inconclusive and model-dependent. Our findings contribute to the literature of repurchase signaling in a modern, Swedish context, suggesting persistent market underreaction.

Information

Författare: Byman, Victor, Håkansson, William
Lärosäte / institution: Handelshögskolan i Stockholm/Institutionen för finansiell ekonomi
Publiceringsdatum: 2025
Uppsatstyp: Kandidat-uppsats
Språk: Engelska
Nyckelord: ⌕Abnormal Returns ⌕Share Repurchases ⌕Undervaluation ⌕Underreaction ⌕Market signaling