Cross-listing, Information Environment, and Market Value: Evidence from U.S. Firms That List on Foreign Stock Exchanges
This paper examines how cross-listing impacts analyst coverage and forecast accuracy for U.S. firms that cross-list on foreign exchanges. by focusing on U.S. firms cross-listing abroad, we are able to discriminate between two competing explanations for the improvements in information intermediation experienced by foreign firms cross-listing in the U.S. (Lang, Lins, and Miller 2003); that is, whether the improvements are driven by generic cross-listing effects or by the strict disclosure and regulatory requirements specific to the U.S. markets. Our cross-sectional analysis indicates that cross-listing is negatively associated with analyst coverage, and our time-series analysis yields only marginal evidence of post-cross-listing improvement in forecast accuracy. Thus the cross-listing benefits documented in prior research for foreign firms cross-listing in the U.S. Are not generalizable to all cross-listings and may be attributable to the strong disclosure and regulatory environment prevalent in the United States.
Eng, L., Nabar, S., & Mian, G. M. (2008). Cross-listing, Information Environment, and Market Value: Evidence from U.S. Firms That List on Foreign Stock Exchanges. Journal of International Accounting Research.
The definitive version is available at http://dx.doi.org/10.2308/jiar.2008.7.2.25
Business and Information Technology
Keywords and Phrases
Cross-Listing; Information Environment; Market Value
Article - Journal
© 2008 American Accounting Association, All rights reserved.