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Volume 9
Issue 3
Online publication date 2013-10-25
Title Closing the value gap by the means of stock repurchase announcement – the case of Warsaw Stock Exchange
Author Tomasz Slonski, Bartosz Zawadzki
This article shows that announcement of share repurchase programs on Polish market is used as a price catalyst when the spread between intrinsic and market value is large. The article presents determinants, conditions and results of 77 open market share repurchase programs conducted on Warsaw Stock Exchange (WSE) between 2005 and 2010. We find the  behaviour of management boards of companies listed on WSE consistent with the market timing theory assumptions, as in most  cases managers passed the information to the market without any additional economic costs. Investors who adopted the strategy to invest in undervalued stocks and hold the securities for 6 months realized a total return of 61.15% in the analyzed period.
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Keywords Share repurchase, event studies, market timing
Pages 56-68
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