Rational financial management: Evidence from seasoned equity offerings

• Main Authors: BARCLAY, Michael, FU, Fangjian, SMITH, Clifford
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2012
• Subjects: Capital Structure; Seasoned Equity Offerings; Tradeoff; Pecking-order; Market-timing; Business; Finance and Financial Management
• Online Access: https://ink.library.smu.edu.sg/lkcsb_research/3224; https://ink.library.smu.edu.sg/context/lkcsb_research/article/4223/viewcontent/SSRN_id1099850.pdf
• Institution: Singapore Management University

Current theories of capital structure have difficulty explaining the aspects of financing behavior we document. In contrast to the tradeoff theory, seasoned equity offers frequently move firms away from their target leverage ratios. At odds with the pecking-order theory, SEO firms typically are fina...