英文摘要 |
This research explored the determinants of a company’s intention to repurchase its own stock from the open-market, under the situation of the information asymmetry. A game-theory model was formulated, in which four variables are identified as the determinants of the company’s strategy for repurchasing its own stock: (a) proportion of share-holding by the insiders, (b) proportion of good companies in the stock market, (c) proportion of shares being previously repurchased from the market, and (d) variances of market values of the stocks in the market. All the variables, except for (c), are predicted to have a positive relationship with the intention to repurchase its’ own shares from the open-market. To empirically test the model, this study used a data set from the Taiwan stock market dating from 2001 to 2003, containing 491 companies and 14 industries. During the data collection period, 76 companies in the data set did repurchase their own stock from the market. The empirical test findings were consistent with the model prediction, except for the proportion of shares held by insiders, which was not a significant variable. The research findings confirmed that the information-signaling hypothesis under information asymmetry has an ability to explain a firm’s behavior in share repurchase. This research also provides some information to investors regarding the potential for a company to repurchase its’ own stock from the open market. |