Analysis Of Motivation And Effect Of Stock Repurchase

Stock repurchasing refers to the behavior of a listed company repurchasing a certain number of ordinary shares issued by the company on the stock market in cash.In the 1970 s,stock repurchases began in the United States.After a long period of development,stock repurchases,as an effective means of the capital market,can not only optimize the capital structure and increase the value of the company,but also help companies avoid malicious takeover by competitors,so they are subject to Western The capital market is widely used.China's capital market started late.As China's capital market continues to open to the outside world,more and more companies are using the advantages and characteristics of stock repurchases to achieve corporate governance.Listed companies hope to increase the value of stocks by repurchasing stocks,establish a good image of the company in the capital market,and achieve the goal of maximizing shareholder wealth.In the past two years,China's stock market has been sluggish,and many listed companies have launched stock repurchase programs.The number of stock repurchases has increased dramatically,and the scale of repurchase has reached a record high.The Shanghai Stock Exchange and Shenzhen Stock Exchange have successively issued documents to support listed companies to repurchase shares.The China Securities Regulatory Commission held relevant meetings,including improving the stock repurchase system for important work items.This article selects a representative example-the stock repurchase event of Shaanxi Coal Industry Co.,Ltd.as the research object,and conducts an in-depth study on the motivation of the company's stock repurchase and the market and financial effects of the repurchase on the company.This paper uses literature research method,theoretical induction method,case study method,event research method and comparative analysis method to analyze the motivation,market effect and financial effect of Shaanxi coal industry stock repurchase.The full text is divided into six chapters.The first chapter is an introduction,which mainly elaborates the research background and significance of the thesis,domestic and foreign literature review,research ideas,content and methods.The second chapter is a theoretical review,which summarizes the basic concepts of stock repurchases based on literature and theories,and explains the relevant theories of stock repurchase motivation and effects.The third chapter introduces the basic situation of the stock repurchase case of Shaanxi Coal Industry,mainly including the company's profile and the situation of stock repurchase.The fourth chapter is the analysis of the repurchase motivation.Through the company's specific financial data,combined with relevant theories,combining theory with practice,a comprehensive analysis and analysis of the repurchase motivation of Shaanxi Coal Industry.The main motivations are signal transmission theory,financial leverage theory,and free cash flow.Theory,management incentives and EPS drivers.Chapter V analyzes the repurchase effect from the company's perspective,including market and financial effects,uses the event research method to calculate the extraordinary return rate and cumulative extraordinary rate of return on the repurchase announcement day,and analyzes the stock price changes during and after the repurchase by comparison and analysis.To analyze market effects.Select the appropriate five types of financial indicators and use the corresponding financial indicators to illustrate the financial effect.Chapter 6 is the conclusion and enlightenment of the research.Through the study of this case,the following conclusions and enlightenment are drawn.The main motivation for the company's stock repurchase is to increase the company's stock price.This repurchase has several practical implications: stabilize the asset-liability structure,reduce agency costs,and be used for management equity incentives;the market effect of the company's stock repurchase is not significant,the main reason It is due to the small scale of the repurchase,unfavorable capital market environmental factors and the company's development strategy to be improved;the company's stock repurchase has a small impact on operating capacity.At the same time,it draws thoughts and revelations about stock repurchases.Stock repurchase has limited impact on the company's long-term stock price rise;a reasonable repurchase plan should be formulated to avoid financial risks;during the repurchase process,the protection of the interests of small and medium-sized shareholders and creditors should be increased;the construction of the stock repurchase system should be actively improved to make the stock repurchase Purchase has become an important basic system in the capital market.