Orphan versus non-orphan IPOs: the difference analyst coverage makes

Boissin, Romain (2012): Orphan versus non-orphan IPOs: the difference analyst coverage makes. Forthcoming in:

Abstract

This paper addresses the question of the importance of analyst coverage for the long-run returns of IPO firms over the period from 1991 to 2010. In US IPOs, during the one- to five-year horizon, we find a significant long-run abnormal performance by orphans (IPOs without analyst coverage) compared to non-orphans (IPOs with analyst coverage.Further analysis reveals that this outperformance by non-orphans stems from high analyst coverage. Our results are robust after accounting for venture capital backing, underwriting syndicates, underpricing, institutional investor ownership, or operating performance variables.

• Item Type: MPRA Paper
• Language: English
• Keywords: IPOs, analyst coverage, long-run performance
• Subjects: G - Financial Economics > G1 - General Financial Markets > G14 - Information and Market Efficiency ; Event Studies ; Insider Trading; G - Financial Economics > G2 - Financial Institutions and Services > G24 - Investment Banking ; Venture Capital ; Brokerage ; Ratings and Ratings Agencies

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