Bazdrech, Santiago; Belo, Frederico; Lin, Xiaoji - London School of Economics (LSE) - 2008
even after controlling for investment, size, book-to-market and momentum as well as other known predictors of stock returns … forward looking in nature and thus informative about the firms’ expectations about future cash-flows and risk …-adjusted discount rates. The model implies that the investment rate and the hiring rate predicts stock returns because these variables …