The DOI matches its Crossref record; 34 of the 34 references it cites were found in a registry or an index.
The cost of financial flexibility: Evidence from share repurchases
Open accessAbstract
Over the last two decades, share repurchases have emerged as the dominant payout channel, offering a more flexible means of returning excess cash to investors. However, little is known about the costs associated with payout-related financial flexibility. Using a unique identification strategy, we document a significant cost. We find that actual repurchase investments underperform hypothetical investments that mechanically smooth repurchase dollars through time by approximately two percentage points per year on average. This cost of financial flexibility is correlated with earnings management, managerial entrenchment, and less institutional monitoring.
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Cites
Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers
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Amihud, Y. (2002) · Journal of Financial Markets · doi:10.1016/s1386-4181(01)00024-6 · Cited by 9,963
CEO Overconfidence and Corporate Investment
MALMENDIER, U., & TATE, G. (2005) · The Journal of Finance · doi:10.1111/j.1540-6261.2005.00813.x · Cited by 3,669
What Matters in Corporate Governance?
Bebchuk, L., Cohen, A., & Ferrell, A. (2009) · Review of Financial Studies · doi:10.1093/rfs/hhn099 · Cited by 2,906
Payout policy in the 21st century
Brav, A., Graham, J. R., Harvey, C. R., & Michaely, R. (2005) · Journal of Financial Economics · doi:10.1016/j.jfineco.2004.07.004 · Cited by 2,239
Corporate Cash Reserves and Acquisitions
Harford, J. (1999) · The Journal of Finance · doi:10.1111/0022-1082.00179 · Cited by 2,064
Institutional Investors and Executive Compensation
Hartzell, J. C., & Starks, L. T. (2003) · The Journal of Finance · doi:10.1046/j.1540-6261.2003.00608.x · Cited by 2,005
Market underreaction to open market share repurchases
Ikenberry, D., Lakonishok, J., & Vermaelen, T. (1995) · Journal of Financial Economics · doi:10.1016/0304-405x(95)00826-z · Cited by 1,733
Why Do Firms Repurchase Stock?
Dittmar, A. K. (2000) · The Journal of Business · doi:10.1086/209646 · Cited by 932
Investor Sophistication and Patterns in Stock Returns after Earnings Announcements
Bartov, E., Radhakrishnan, S., & Krinsky, I. (2000) · The Accounting Review · doi:10.2308/accr.2000.75.1.43 · Cited by 745
Cited by
Working capital financing and corporate profitability of Indian manufacturing firms
Panda, A. K., & Nanda, S. (2018) · Management Decision · doi:10.1108/md-07-2017-0698 · Cited by 75
Metadata
- Authors
- Bonaimé, A. A., Hankins, K. W., & Jordan, B. D.
- Affiliations
- University of Arizona (US)
- University of Kentucky (US)
- Corresponding author
- Bonaimé, Alice A.
- Hankins, Kristine W.
- Jordan, Bradford D.
- Venue
- Journal of Corporate Finance
- Publisher
- Elsevier BV
- Published
- 2016-06
- Volume
- 38
- Pages
- 345-362
- ISSN
- 0929-1199 (ISSN-L)
- OpenAlex
- W3123392363
- Cited by
- 68
- References
- 34
- Citations by year
- 2026: 2 · 2025: 11 · 2024: 7 · 2023: 10 · 2022: 6 · 2021: 8 · 2020: 7 · 2019: 9 · 2018: 5 · 2017: 2
- FWCI
- 18.20
- Type
- journal article
- Language
- en
- Open access
- green
- doi.org
- Licence
- www.elsevier.com/tdm/userlicense/1.0/ (tdm)
- Locations
- Journal of Corporate Finance (publishedVersion)
- SSRN Electronic Journal (acceptedVersion)
- UA Campus Repository (The University of Arizona) (acceptedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Finance › Corporate Finance and Governance
- Social Sciences › Economics, Econometrics and Finance › Finance › Financial Markets and Investment Strategies
- Social Sciences › Business, Management and Accounting › Accounting › Auditing, Earnings Management, Governance
- Keywords
- share repurchases, financial flexibility, dividend policy, earnings management, managerial entrenchment, institutional monitoring
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Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
Semantic Scholar’s data is described in: Kinney, R., et al. (2023). The Semantic Scholar Open Data Platform. arXiv:2301.10140.
