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Full-Text Articles in Business
What’S Wrong With Peg?, Charles J. Higgins
What’S Wrong With Peg?, Charles J. Higgins
Finance Faculty Works
PEG is a newer investment ratio measure of a security’s PE ratio divided by the firm’s growth rate as a percentage. It is examined and contrasted with other investment valuation measures. PEG is shown to be problematic in terms of its units of measure, in what it purports to appropriately determine, and it is non monotonic for relatively profitable firms and is only slightly indicative of correct security selection for relatively unprofitable firms.
Travel Safety: Time Versus Distance, Charles J. Higgins
Travel Safety: Time Versus Distance, Charles J. Higgins
Finance Faculty Works
No abstract provided.
How Do Acquirers Choose Between Mergers And Tender Offers?, David Offenberg, Christo Pirinsky
How Do Acquirers Choose Between Mergers And Tender Offers?, David Offenberg, Christo Pirinsky
Finance Faculty Works
Tender offers provide the advantage of substantially faster completion times than mergers. However, a tender offer signals to the target higher demand for its shares and raises its reservation price. In equilibrium, bidders tradeoff speed and cost. Consistent with this theory, we show that deals in more competitive environments and deals with fewer external impediments on execution are more likely to be structured as tender offers. Tender offers also require higher premiums than mergers. Finally, the rivals of the bidding firm realize significantly lower announcement returns and subsequent operating performance in tender offers than in mergers.