Butler, Alexander W.; Cornaggia, Jess; Grullon, Gustavo; … - In: Journal of Financial Economics 101 (2011) 3, pp. 666-683
Both market timing and investment-based theories of corporate financing predict under-performance after firms raise capital, but only market timing predicts that the composition of financing (equity compared with debt) should also forecast returns. In cross-sectional tests, we find that the...