Cash shortfalls in IPO firms

被引：0
作者：
Liu, Lei [1 ]
Jacoby, Gady [2 ]
Song, Xiaoping [3 ]
Zheng, Steven Xiaofan [3 ]
机构：
[1] Jinling Inst Technol, Sch Business, Nanjing, Jiangsu, Peoples R China
[2] Coll Management Acad Studies, Sch Econ, Rishon Letsyon, Israel
[3] Univ Manitoba, Asper Sch Business, 181 Freedman Crescent, Winnipeg, MB R3T 5V4, Canada
来源：
FINANCE RESEARCH LETTERS | 2023年 / 52卷
关键词：
Cash shortfalls; IPO; Cash flows; DECISION;
D O I：
10.1016/j.frl.2022.103520
中图分类号：
F8 [财政、金融];
学科分类号：
0202 ;
摘要：
We find that most IPO firms will run out of cash soon if they did not receive proceeds from IPOs. The cash shortfalls are not caused by increases in capital expenditure, R&D, M&A, or debt repayment and persist during the 5 years after IPO. Negative net cash flows help explain the persistent cash shortfalls. These results are consistent with the funding horizon theory. IPO firms with more initial cash shortfalls also have lower cash flows in the next 5 years, suggesting that initial cash shortfalls can be used to predict the future operating performance of IPO firms.
引用
收藏
页数：7
相关论文
共 14 条
  • [1] Shareholder Diversification and the Decision to Go Public
    Bodnaruk, Andriy
    Kandel, Eugene
    Massa, Massimo
    Simonov, Andrei
    [J]. REVIEW OF FINANCIAL STUDIES, 2008, 21 (06) : 2779 - 2824
  • [2] Initial public offerings: An analysis of theory and practice
    Brau, JC
    Fawcett, SE
    [J]. JOURNAL OF FINANCE, 2006, 61 (01) : 399 - 436
  • [3] Going public to acquire? The acquisition motive in IPOs
    Celikyurt, Ugur
    Sevilir, Merih
    Shivdasani, Anil
    [J]. JOURNAL OF FINANCIAL ECONOMICS, 2010, 96 (03) : 345 - 363
  • [4] The Going-Public Decision and the Product Market
    Chemmanur, Thomas J.
    He, Shan
    Nandy, Debarshi K.
    [J]. REVIEW OF FINANCIAL STUDIES, 2010, 23 (05) : 1855 - 1908
  • [5] Capital structure dynamics and transitory debt
    DeAngelo, Harry
    DeAngelo, Linda
    Whited, Toni M.
    [J]. JOURNAL OF FINANCIAL ECONOMICS, 2011, 99 (02) : 235 - 261
  • [6] Seasoned equity offerings, market timing, and the corporate lifecycle
    DeAngelo, Harry
    DeAngelo, Linda
    Stulz, Rene M.
    [J]. JOURNAL OF FINANCIAL ECONOMICS, 2010, 95 (03) : 275 - 295
  • [7] The marketing role of IPOs: evidence from internet stocks
    Demers, E
    Lewellen, K
    [J]. JOURNAL OF FINANCIAL ECONOMICS, 2003, 68 (03) : 413 - 437
  • [8] Persistent negative cash flows, staged financing, and the stockpiling of cash balances *
    Denis, David J.
    McKeon, Stephen B.
    [J]. JOURNAL OF FINANCIAL ECONOMICS, 2021, 142 (01) : 293 - 313
  • [9] Corporate Cash Shortfalls and Financing Decisions
    Huang, Rongbing
    Ritter, Jay R.
    [J]. REVIEW OF FINANCIAL STUDIES, 2021, 34 (04) : 1789 - 1833
  • [10] AN EMPIRICAL-INVESTIGATION OF IPO RETURNS AND SUBSEQUENT EQUITY OFFERINGS
    JEGADEESH, N
    WEINSTEIN, M
    WELCH, I
    [J]. JOURNAL OF FINANCIAL ECONOMICS, 1993, 34 (02) : 153 - 175
12