Initial Public Offerings: Cfo Perceptions

Posted: 8 Aug 2006

See all articles by James C. Brau

James C. Brau

Brigham Young University

Patricia A Ryan

Colorado State University, Fort Collins - Department of Finance & Real Estate

Irv DeGraw

Saint Petersburg College

Abstract

We examine four issues pertaining to IPOs using a survey of 438 CFOs. First, why do firms go public? Second, is CFO sentiment stationary across bear and bull markets? Third, what concerns CFOs about going public? Fourth, do CFO perceptions correlate with returns? Results support funding for growth and liquidity as the primary reasons for IPOs. CFO sentiment is generally stationary in pre- and post-bubble years. Managers are concerned with the direct costs of going public, such as underwriting fees, as well as indirect costs. We find a negative relation between a focus on immediate growth and longterm abnormal returns.

Keywords: IPOs, initial public offerings, equity offering, survey, chief financial officer, CFO, perceptions

JEL Classification: G14, G24, G32, G34

Suggested Citation

Brau, James C. and Ryan, Patricia A and DeGraw, Irv, Initial Public Offerings: Cfo Perceptions. Financial Review, Vol. 41, No. 4, November 2006, Available at SSRN: https://ssrn.com/abstract=922454

James C. Brau

Brigham Young University ( email )

TNRB 640
Marriott School
Provo, UT 84602
United States
801-318-7919 (Phone)
801-422-0108 (Fax)

HOME PAGE: http://marriottschool.byu.edu/emp/brau/

Patricia A Ryan (Contact Author)

Colorado State University, Fort Collins - Department of Finance & Real Estate ( email )

Fort Collins, CO 80523
United States

Irv DeGraw

Saint Petersburg College ( email )

13805 58th Street N
Largo, FL 33760
United States

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