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Wansley, J., Lane, W., Sarkar, S., 1989. Managements' View on Share Repurchase and Tender Offer Premiums. Financial Management 18, 97-110.

has been cited by the following article:

Article

The Explanation Power of Investors' Opinion Divergence in Open Market Repurchases

1Department of Economics, Finance and Insurance & Risk Management, University of Central Arkansas, Conway AR, USA

2Model Development Department, Regions Bank, Birmingham AL, USA


Journal of Finance and Accounting. 2015, Vol. 3 No. 2, 18-36
DOI: 10.12691/jfa-3-2-2
Copyright © 2015 Science and Education Publishing

Cite this paper:
Xiaochun Liu, Hao Wang. The Explanation Power of Investors' Opinion Divergence in Open Market Repurchases. Journal of Finance and Accounting. 2015; 3(2):18-36. doi: 10.12691/jfa-3-2-2.

Correspondence to: Xiaochun  Liu, Department of Economics, Finance and Insurance & Risk Management, University of Central Arkansas, Conway AR, USA. Email: xliu@uca.edu

Abstract

This paper proposes a new theory to explain the behavior of share repurchases by assuming heterogeneity in investors' beliefs. This new theory provides testable hypotheses that are examined empirically in this paper. Our empirical results show strong evidence for the explanation power of investors' opinion divergence in firms repurchasing shares, even after considering controlling variables such as the undervaluation-signaling hypothesis. The results are also robust to various measures of investors' divergent opinions in open market repurchases.

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