Investment opportunities, free cash flow and stock valuation effects of corporate investments: The case of Taiwanese investments in China

被引：0
|
作者：
Chen S.-S. [1 ,3 ]
Chung T.-Y. [2 ]
Chung L.-I. [1 ,3 ]
机构：
[1] Department of Finance, College of Management, Yuan Ze University, Chung-Li, Taoyuan
[2] Department of Accounting, College of Management, Yuan Ze University, Chung-Li, Taoyuan
[3] Department of Finance, College of Management, Yuan Ze University, Chung-Li, Taoyuan
来源：
Review of Quantitative Finance and Accounting | 2001年 / 16卷 / 4期
关键词：
Cross-border investments; Free cash flow; Investment opportunities;
D O I：
10.1023/A:1011270824166
中图分类号：
学科分类号：
摘要：
This paper examines the importance of investment opportunities and free cash flow in assessing the stock market reaction to announcements of cross-border investments in China by Taiwanese firms. Our results support the investment opportunities hypothesis that Taiwanese firms with favorable investment opportunities have significantly positive response to the announcements of their investments in China whereas firms with poor investment opportunities have negative response to such announcements. In contrast, we find no support for the free cash flow hypothesis. Our findings add to the understanding of the determinants of the wealth effect of cross-border investment decisions in the Asia-Pacific region. © 2001 Kluwer Academic Publishers.
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页码：299 / 310
页数：11
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