Michael Kisser

Kisser, Michael & Rapushi, Loreta (2022)

Equity issues, creditor control and market timing patterns: Evidence from leverage decreasing recapitalizations

Journal of Empirical Finance, 67, s. 196-216. Doi: https://doi.org/10.1016/j.jempfin.2022.03.007 - Fulltekst i vitenarkiv

We contribute to the literature on “market timing” by exploring periods of simultaneous equity issues and debt retirements (a leverage decreasing recapitalization, LDR). Contrary to traditional equity issues, LDRs are predicted by measures of creditor control whereas capital investment has no such predictive power. Nevertheless, LDRs occur after stock price run- ups and in periods of high valuation which subsequently decrease. The valuation dynamics are robust and also obtain for subsamples of LDR firms violating financial covenants. A comparison to debt retirements financed by illiquid asset sales and an analysis of discretionary cost items further corroborates the interpretation that LDR firms successfully “time the market” to finance the debt retirement.

Eckbo, B. Espen & Kisser, Michael (2021)

The Leverage-Profitability Puzzle Resurrected

Review of Finance, 25(4) , s. 1089-1128. Doi: https://doi.org/10.1093/rof/rfaa032 - Fulltekst i vitenarkiv

With zero capital structure rebalancing costs, dynamic trade-off theory predicts that firms stay at their leverage targets with more profitable firms staying at higher leverage. This prediction is rejected by the robustly negative correlation between leverage and profitability. When rebalancing costs are added to this theory, it predicts a positive leverage–profitability correlation only in periods where companies pay these costs and actively rebalance their capital structures. However, we show that the correlation is negative when firms issue debt and distribute the proceeds to shareholders—precisely the case where the theory predicts it should be positive. Our results thus resurrect the leverage–profitability puzzle.

Eckbo, B. Espen & Kisser, Michael (2020)

Tradeoff Theory and Leverage Dynamics of High-Frequency Debt Issuers

Review of Finance, 25(2) Doi: https://doi.org/10.1093/rof/rfaa018 - Fulltekst i vitenarkiv

We test whether high-frequency net-debt issuers (HFIs)—public industrial companies with relatively low issuance costs and high debt-financing benefits—manage leverage toward long-run targets. Our answer is they do not: (1) the leverage–profitability correlation is negative even in quarters with leverage rebalancing; (2) the speed-of-adjustment to target leverage deviations is no higher for HFIs than for low-frequency net-debt issuers; and (3) under-leveraged HFIs do not speed up rebalancing activity in significant investment periods. Thus, even in the subset of firms most likely to follow dynamic trade-off theory, the theory does not appear to hold.

Kisser, Michael; Kiff, John & Soto, Mauricio (2017)

Do managers of U.S. defined benefit pension plan sponsors use regulatory freedom strategically?

Journal of Accounting Research, 55(5) , s. 1213-1255. Doi: https://doi.org/10.1111/1475-679X.12182

Kisser, Michael & Kiff, John (2014)

A shot at regulating securitization

Journal of Financial Stability, 10(1) , s. 32-49. Doi: https://doi.org/10.1016/j.jfs.2013.02.003

Axenrod, Michael & Kisser, Michael (2021)

Does mandatory recognition of off-balance sheet liabilities affect capital structure choice? Evidence from SFAS 158

[Conference Lecture]. Event

Axenrod, Michael & Kisser, Michael (2021)

Does mandatory recognition of off-balance sheet liabilities affect capital structure choice? Evidence from SFAS 158

[Report Research]. SSRN

Kisser, Michael & Rapushi, Loreta (2021)

Equity Issues, Creditor Control and Market Timing Patterns: Evidence from Leverage Decreasing Recapitalizations

[Report Research]. SSRN

Kisser, Michael & Rapushi, Loreta (2020)

Equity Issues, Creditor Control and Market Timing Patterns: Evidence From Leverage Decreasing Recapitalizations

[Conference Lecture]. Event

Kisser, Michael & Rapushi, Loreta (2020)

Equity Issues, Creditor Control and Market Timing Patterns: Evidence from Leverage Decreasing Recapitalizations

[Conference Lecture]. Event