haku: @author Core, J. E. / yhteensä: 5
viite: 5 / 5
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| Tekijä: | Core, J. E. Schrand, C. M. |
| Otsikko: | The effect of accounting-based debt covenants on equity valuation |
| Lehti: | Journal of Accounting & Economics
1999 : FEB, VOL. 27:1, p. 1-34 |
| Asiasana: | Debt Equity capital Valuation Gearing Pricing Models USA |
| Kieli: | eng |
| Tiivistelmä: | In the paper, an option framework is used to model equity valuation when firms face costs associated with violating accounting-based debt covenants. The model shows that the value of equity depends on 2 factors: the economic value of the firm and the probability that the firm violates the covenant. Consistent with the model's prediction that the covenant effect is greatest for firms near covenant violation, responses to earnings are found that are less informative about future cash flows are significant only for thrift institutions that are near violation of regulatory net worth covenants. |
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