The effectiveness of institutional activism
Researchers examined earnings-forecast revisions and stock returns after release of the Focus List of poorly performing companies by the Council of Institutional Investors. Using Tobin's q as a measure of a company's ability to improve performance, researchers found significant and positiv...
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| Main Authors: | , , |
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| Format: | text |
| Language: | English |
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Institutional Knowledge at Singapore Management University
2001
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| Subjects: | |
| Online Access: | https://ink.library.smu.edu.sg/lkcsb_research/2204 https://ink.library.smu.edu.sg/context/lkcsb_research/article/3203/viewcontent/Effectiveness_of_institutional_activism.pdf |
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| Institution: | Singapore Management University |
| Language: | English |
| Summary: | Researchers examined earnings-forecast revisions and stock returns after release of the Focus List of poorly performing companies by the Council of Institutional Investors. Using Tobin's q as a measure of a company's ability to improve performance, researchers found significant and positive abnormal forecast revisions and post-release stock returns for companies with q greater than one. Findings support the proposition that institutional activism is effective for underperforming companies - but only those companies with the ability to respond to the challenge to improve performance. |
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