The Journal of Finance publishes leading research across all the major fields of finance. It is one of the most widely cited journals in academic finance, and in all of economics. Each of the six issues per year reaches over 8,000 academics, finance professionals, libraries, and government and financial institutions around the world. The journal is the official publication of The American Finance Association, the premier academic organization devoted to the study and promotion of knowledge about financial economics.
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What is the Intrinsic Value of the Dow?
Published: 10/1999, Volume: 54, Issue: 5 | DOI: 10.1111/0022-1082.00164 | Cited by: 496
Charles M. C. Lee, James Myers, Bhaskaran Swaminathan
We model the time‐series relation between price and intrinsic value as a cointegrated system, so that price and value are long‐term convergent. In this framework, we compare the performance of alternative estimates of intrinsic value for the Dow 30 stocks. During 1963–1996, traditional market multiples (e.g., B/P, E/P, and D/P ratios) have little predictive power. However, a V/P ratio, where V is based on a residual income valuation model, has statistically reliable predictive power. Further analysis shows time‐varying interest rates and analyst forecasts are important to the success of V. Alternative forecast horizons and risk premia are less important.
The Capital Structure Puzzle
Published: 7/1984, Volume: 39, Issue: 3 | DOI: 10.1111/j.1540-6261.1984.tb03646.x | Cited by: 2003
STEWART C. MYERS
THE CONTROL OF CONSUMER CREDIT IN AUSTRALIA
Published: 9/1961, Volume: 16, Issue: 3 | DOI: 10.1111/j.1540-6261.1961.tb02838.x | Cited by: 2
Margaret G. Myers
Outside Equity
Published: 6/2000, Volume: 55, Issue: 3 | DOI: 10.1111/0022-1082.00239 | Cited by: 303
Stewart C. Myers
Equity financing is modeled when cash flows and asset values are not verifiable. Investors have enforceable property rights to the firm's assets, but cannot prevent insiders (managers or entrepreneurs) from capturing cash flow. Insiders must coinvest and pay in each period a dividend sufficient to ensure outside investors' participation for at least one more period. Intervention by the investors must be limited by an agreement with insiders or by costs of collective action. Basic models are extended to show why firms go public and why agency costs necessarily arise when the act of investment is not immediately verifiable.
EFFECTS OF UNCERTAINTY ON THE VALUATION OF SECURITIES AND THE FINANCIAL DECISIONS OF THE FIRM*
Published: 3/1968, Volume: 23, Issue: 1 | DOI: 10.1111/j.1540-6261.1968.tb03014.x | Cited by: 0
Stewart Clay Myers
A NOTE ON LINEAR PROGRAMMING AND CAPITAL BUDGETING
Published: 3/1972, Volume: 27, Issue: 1 | DOI: 10.1111/j.1540-6261.1972.tb00622.x | Cited by: 18
Stewart C. Myers
DISCUSSION
Published: 5/1971, Volume: 26, Issue: 2 | DOI: 10.1111/j.1540-6261.1971.tb00913.x | Cited by: 5
Stewart C. Myers
DISCUSSION
Published: 5/1982, Volume: 37, Issue: 2 | DOI: 10.1111/j.1540-6261.1982.tb00883.x | Cited by: 0
S. C. MYERS
INTERACTIONS OF CORPORATE FINANCING AND INVESTMENT DECISIONS—IMPLICATIONS FOR CAPITAL BUDGETING
Published: 3/1974, Volume: 29, Issue: 1 | DOI: 10.1111/j.1540-6261.1974.tb00021.x | Cited by: 352
Stewart C. Myers
Subjective Cash Flow and Discount Rate Expectations
Published: 3/11/2021, Volume: 76, Issue: 3 | DOI: 10.1111/jofi.13016 | Cited by: 176
RICARDO DELAO, SEAN MYERS
Why do stock prices vary? Using survey forecasts, we find that cash flow growth expectations explain most movements in the S&P 500 price‐dividend and price‐earnings ratios, accounting for at least 93% and 63% of their variation. These expectations comove strongly with price ratios, even when price ratios do not predict future cash flow growth. In comparison, return expectations have low volatility and small comovement with price ratios. Short‐term, rather than long‐term, expectations account for most price ratio variation. We propose an asset pricing model with beliefs about earnings growth reversal that accurately replicates these cash flow growth expectations and dynamics.
REPLY
Published: 3/1977, Volume: 32, Issue: 1 | DOI: 10.1111/j.1540-6261.1977.tb03259.x | Cited by: 1
Stewar T. C. Myers
MEASURING ALLOCATIVE EFFICIENCY WITH TECHNOLOGICAL UNCERTAINTY
Published: 5/1976, Volume: 31, Issue: 2 | DOI: 10.1111/j.1540-6261.1976.tb01914.x | Cited by: 0
Stewart Myers, Clement G. Krouse
CONCEPTUAL PROBLEMS IN THE USE OF RISK‐ADJUSTED DISCOUNT RATES*
Published: 12/1966, Volume: 21, Issue: 4 | DOI: 10.1111/j.1540-6261.1966.tb00277.x | Cited by: 48
Alexander A. Robichek, Stewart C. Myers
A Theory of Takeovers and Disinvestment
Published: 3/20/2007, Volume: 62, Issue: 2 | DOI: 10.1111/j.1540-6261.2007.01224.x | Cited by: 109
BART M. LAMBRECHT, STEWART C. MYERS
We present a real‐options model of takeovers and disinvestment in declining industries. As product demand declines, a first‐best closure level is reached, where overall value is maximized by closing the firm and releasing its capital to investors. Absent takeovers, managers of underleveraged firms always close too late, although golden parachutes may accelerate closure. We analyze the effects of takeovers of under‐leveraged firms. Takeovers by raiders enforce first‐best closure. Hostile takeovers by other firms occur either at the first‐best closure point or too early. Closure in management buyouts and mergers of equals happens inefficiently late.
A PROGRAMMING APPROACH TO CORPORATE FINANCIAL MANAGEMENT
Published: 5/1974, Volume: 29, Issue: 2 | DOI: 10.1111/j.1540-6261.1974.tb03072.x | Cited by: 26
STEWART C. MYERS, GERALD A. POGUE
VALUATION OF THE FIRM: EFFECTS OF UNCERTAINTY IN A MARKET CONTEXT
Published: 5/1966, Volume: 21, Issue: 2 | DOI: 10.1111/j.1540-6261.1966.tb00222.x | Cited by: 33
Alexander A. Robichek, Stewart C. Myers
A Lintner Model of Payout and Managerial Rents
Published: 9/12/2012, Volume: 67, Issue: 5 | DOI: 10.1111/j.1540-6261.2012.01772.x | Cited by: 191
BART M. LAMBRECHT, STEWART C. MYERS
We develop a dynamic agency model in which payout, investment, and financing decisions are made by managers who attempt to maximize the rents they take from the firm, subject to a capital market constraint. Managers smooth payout to smooth their flow of rents. Total payout (dividends plus net repurchases) follows Lintner's (1956) target adjustment model. Payout smooths out transitory shocks to current income and adjusts gradually to changes in permanent income. Smoothing is accomplished by borrowing or lending. Payout is not cut back to finance capital investment. Risk aversion causes managers to underinvest, but habit formation mitigates the degree of underinvestment.
CAPITAL BUDGETING AND THE CAPITAL ASSET PRICING MODEL: GOOD NEWS AND BAD NEWS
Published: 5/1977, Volume: 32, Issue: 2 | DOI: 10.1111/j.1540-6261.1977.tb03272.x | Cited by: 218
Stewart C. Myers, Stuart M. Turnbull
TERM STRUCTURE WITH UNCERTAIN INFLATION
Published: 5/1977, Volume: 32, Issue: 2 | DOI: 10.1111/j.1540-6261.1977.tb03268.x | Cited by: 2
Stewart C. Myers, Richard Brealey, Stephen Schaefer
VALUATION OF FINANCIAL LEASE CONTRACTS
Published: 6/1976, Volume: 31, Issue: 3 | DOI: 10.1111/j.1540-6261.1976.tb01924.x | Cited by: 196
Stewart C. Myers, David A. Dill, Alberto J. Bautista
The Internal Governance of Firms
Published: 5/23/2011, Volume: 66, Issue: 3 | DOI: 10.1111/j.1540-6261.2011.01649.x | Cited by: 288
VIRAL V. ACHARYA, STEWART C. MYERS, RAGHURAM G. RAJAN
We develop a model of internal governance where the self‐serving actions of top management are limited by the potential reaction of subordinates. Internal governance can mitigate agency problems and ensure that firms have substantial value, even with little or no external governance by investors. External governance, even if crude and uninformed, can complement internal governance and improve efficiency. This leads to a theory of investment and dividend policy, in which dividends are paid by self‐interested CEOs to maintain a balance between internal and external control.
DISCUSSION
Published: 5/1975, Volume: 30, Issue: 2 | DOI: 10.1111/j.1540-6261.1975.tb01821.x | Cited by: 0
M. J. Brennan, Willard T. Carleton, Stewart C. Myers
The Effect of Voluntary Spin‐off Announcements on Shareholder Wealth
Published: 12/1983, Volume: 38, Issue: 5 | DOI: 10.1111/j.1540-6261.1983.tb03843.x | Cited by: 173
JAMES A. MILES, JAMES D. ROSENFELD
This paper presents estimates of the effect of a voluntary spin‐off announcement on shareholder wealth. The results show that spin‐off announcements have a positive influence on stock prices and that the relative increase in share price is greater for large spin‐offs than for small ones.
IS THE “NEUTRALIZED MONEY STOCK” UNBIASED?*: COMMENT
Published: 12/1976, Volume: 31, Issue: 5 | DOI: 10.1111/j.1540-6261.1976.tb03231.x | Cited by: 0
James R. Barth, James T. Bennett
BOOKS RECEIVED
Published: 3/1962, Volume: 17, Issue: 1 | DOI: 10.1111/j.1540-6261.1962.tb04263.x | Cited by: 0
James Gillies
BOOKS RECEIVED
Published: 12/1963, Volume: 18, Issue: 4 | DOI: 10.1111/j.1540-6261.1963.tb01647.x | Cited by: 0
James Gillies
BOOKS RECEIVED
Published: 12/1961, Volume: 16, Issue: 4 | DOI: 10.1111/j.1540-6261.1961.tb04243.x | Cited by: 0
James Gillies
The Losses Realized in Bank Failures
Published: 9/1991, Volume: 46, Issue: 4 | DOI: 10.1111/j.1540-6261.1991.tb04616.x | Cited by: 294
CHRISTOPHER JAMES
This paper examines the losses realized in bank failures. Losses are measured as the difference between the book value of assets and the recovery value net of the direct expenses associated with the failure. I find the loss on assets is substantial, averaging 30 percent of the failed bank's assets. Direct expenses associated with bank closures average 10 percent of assets. An empirical analysis of the determinants of these losses reveals a significant difference in the value of assets retained by the FDIC and similar assets assumed by acquiring banks.
SOME FINANCIAL ASPECTS OF THE CANADIAN GOVERNMENT HOUSING PROGRAM: HISTORY AND PROSPECTIVE DEVELOPMENTS*
Published: 3/1953, Volume: 8, Issue: 1 | DOI: 10.1111/j.1540-6261.1953.tb01133.x | Cited by: 0
James Gillies
BOOKS RECEIVED
Published: 9/1962, Volume: 17, Issue: 3 | DOI: 10.1111/j.1540-6261.1962.tb04331.x | Cited by: 0
James Gillies
THE BURDEN OF THE PUBLIC DEBT: A REVIEW ARTICLE
Published: 12/1965, Volume: 20, Issue: 4 | DOI: 10.1111/j.1540-6261.1965.tb02936.x | Cited by: 15
James Tobin
BOOKS RECEIVED
Published: 3/1963, Volume: 18, Issue: 1 | DOI: 10.1111/j.1540-6261.1963.tb01633.x | Cited by: 0
James Gillies
The Effect of Common‐Stock Dividend Reductions on the Returns of Nonconvertible Preferred Stocks: A Note
Published: 6/1983, Volume: 38, Issue: 3 | DOI: 10.1111/j.1540-6261.1983.tb02517.x | Cited by: 2
JAMES ROSENFELD
An Analysis of Bank Loan Rate Indexation
Published: 6/1982, Volume: 37, Issue: 3 | DOI: 10.1111/j.1540-6261.1982.tb02225.x | Cited by: 13
CHRISTOPHER JAMES
This paper examines the economic rationale for the use of bank loan commitments and the effect on the allocation of bank credit of indexing the loan rate offered through the commitment to the prime. A simple model of the loan market is constructed and used to examine the effect changes in loan demand and the cost of bank funds have on the allocation of bank credit under indexation. It is shown that indexing implies changes in the relative cost of borrowing for certain groups of bank customers. For nonprime customers, an increase in the cost of bank funds results in a decline in the relative cost of borrowing under commitments. The pattern of commitment use is found to be consistent with the predictions of the model.
DOMESTIC POLICY OBJECTIVES AND THE BALANCE OF PAYMENTS
Published: 5/1966, Volume: 21, Issue: 2 | DOI: 10.1111/j.1540-6261.1966.tb00234.x | Cited by: 3
James Duesenberry
REPLY
Published: 9/1966, Volume: 21, Issue: 3 | DOI: 10.1111/j.1540-6261.1966.tb00257.x | Cited by: 0
James Tobin
Bank Debt Restructurings and the Composition of Exchange Offers in Financial Distress
Published: 6/1996, Volume: 51, Issue: 2 | DOI: 10.1111/j.1540-6261.1996.tb02700.x | Cited by: 67
CHRISTOPHER JAMES
This article examines the relation between bank debt forgiveness and the structure of public debt exchange offers in financial distress. I find that the structure of exchange offers and the likelihood of an offer's success are significantly related to whether the bank participates in the restructuring transaction. Exchange offers made in conjunction with bank concessions are characterized by significantly greater reductions in public debt outstanding and significantly less senior debt offered to bondholders. Overall, the results suggest that the structure of a firm's public and private claims significantly affects the firm's ability to modify its capital structure in financial distress.
Relationship‐Specific Assets and the Pricing of Underwriter Services
Published: 12/1992, Volume: 47, Issue: 5 | DOI: 10.1111/j.1540-6261.1992.tb04686.x | Cited by: 96
CHRISTOPHER JAMES
This paper investigates the effect of setup costs on the pricing of investment banking services. The existence of setup costs is predicted to result in lower underwriter spreads in IPOs for firms that are expected to issue again. Consistent with this prediction, I find significantly lower spreads for firms that make subsequent issues. I also find that a firm's likelihood of changing underwriters in a subsequent offer is related to the time between offerings and the underwriter's pricing performance in the IPO. These results suggest that the deviations from optimal IPO pricing carry a penalty for the underwriter.
THE CHANGING ROLE OF BANKS IN THE MARKET FOR EQUITIES
Published: 5/1965, Volume: 20, Issue: 2 | DOI: 10.1111/j.1540-6261.1965.tb00216.x | Cited by: 1
A. James Meigs
ASPECTS OF INSTRUMENT/TARGET LINKS IN CANADIAN MONETARY POLICY*
Published: 3/1974, Volume: 29, Issue: 1 | DOI: 10.1111/j.1540-6261.1974.tb00047.x | Cited by: 0
James W. Dean
ANNOUNCEMENT
Published: 9/1959, Volume: 14, Issue: 3 | DOI: 10.1111/j.1540-6261.1959.tb00137.x | Cited by: 0
James J. O'Leary
Marketplace Fragmentation, Competition, and the Efficiency of the Stock Exchange
Published: 3/1979, Volume: 34, Issue: 1 | DOI: 10.1111/j.1540-6261.1979.tb02078.x | Cited by: 52
JAMES L. HAMILTON
ON THE THEORY OF CONGLOMERATE MERGERS
Published: 9/1977, Volume: 32, Issue: 4 | DOI: 10.1111/j.1540-6261.1977.tb03323.x | Cited by: 58
James H. Scott
A SPECTRAL ANALYSIS OF CYCLICAL FLUCTUATIONS IN MONEY AND BUSINESS*
Published: 9/1971, Volume: 26, Issue: 4 | DOI: 10.1111/j.1540-6261.1971.tb00938.x | Cited by: 0
James T. Bennett
Investment Risk, Bankruptcy Risk, and Pension Reform in Canada
Published: 6/1982, Volume: 37, Issue: 3 | DOI: 10.1111/j.1540-6261.1982.tb02220.x | Cited by: 5
JAMES E. PESANDO
The wealth redistributive effects of retroactive termination insurance together with the difficulty of determining insurance premiums suggest that an alternative response, such as improved disclosure of worker benefits in the event of plan wind‐up, may be preferred if the government remains concerned about the security of benefits in underfunded plans. Members of money purchase plans may well be less subject to investment risk than members of defined benefit plans, contrary to the claim of many. In Canada, defined benefit plans appear to have been transformed into defined benefit/money purchase hybrids, and this has several important implications.
ON CORPORATE DEBT MATURITY STRATEGIES
Published: 3/1976, Volume: 31, Issue: 1 | DOI: 10.1111/j.1540-6261.1976.tb03193.x | Cited by: 173
James R. Morris
THE TWO FACES OF BOND REFUNDING
Published: 6/1975, Volume: 30, Issue: 3 | DOI: 10.1111/j.1540-6261.1975.tb01856.x | Cited by: 9
James S. Ang
THE DEVELOPMENT OF A GENERAL QUASI‐REORGANIZATION CONCEPT*
Published: 9/1956, Volume: 11, Issue: 3 | DOI: 10.1111/j.1540-6261.1956.tb00113.x | Cited by: 0
James S. Schindler
PROCESS OF ECONOMIC ADAPTATION IN A WORLD WAR II NEUTRAL: A CASE STUDY OF SWEDEN*
Published: 9/1961, Volume: 16, Issue: 3 | DOI: 10.1111/j.1540-6261.1961.tb02841.x | Cited by: 0
Daniel James Edwards
THE REPETITIVE BIDDING PROCESS IN MUNICIPAL BOND UNDERWRITING, A CHANCE‐CONSTRAINED PROGRAMMING APPROACH*
Published: 9/1974, Volume: 29, Issue: 4 | DOI: 10.1111/j.1540-6261.1974.tb03112.x | Cited by: 0
James Michael Kelly