The Use of Earnings Forecast in the Building the Capital Strength of Polish IPOs
The Use of Earnings Forecast in the Building the Capital Strength of Polish IPOs
Author(s): Tomasz Sosnowski, Anna Wawryszuk-MisztalSubject(s): Policy, planning, forecast and speculation, Financial Markets, Accounting - Business Administration
Published by: Społeczna Akademia Nauk
Keywords: earnings forecast; initial public offering; equity capital; financial security;
Summary/Abstract: This paper concerns the issue of the role of the earnings forecast voluntarily published in the IPO prospectus in the process of raising funds through the sale of newly created shares. Using the sample of 180 domestic companies seeking to be listed on the Warsaw Stock Exchange between 2006-2015 we examined whether earnings forecast disclosed in the IPO prospectus facilitates raising funds through the public issuance of shares. The results allowed us to conclude that the decision on the disclosure earnings forecast in IPO prospectus does not affect the change of capital strength of new stock companies. However, companies posting over optimistic forecasts obtain more capital to strengthen their capital base.
Journal: Przedsiębiorczość i Zarządzanie
- Issue Year: 18/2017
- Issue No: 9.2
- Page Range: 217-230
- Page Count: 14
- Language: English