We gratefully acknowledge Cynthia Campell, John Doukas, Tim Jenkinson, Conul Golak, William Megginson, Dimitris Petmezas, Jay Ritter and Frank Skinner and two anonymous referees for stimulating comments, as well as Kostas Kassimatis and Aimilios Galariotis for providing us the Fama and French Factors for Greece. We would like to thank meeting participants of the European Financial Management Association in Athens (EFMA 2008) and the Financial Management Association in Prague (FMA 2008) for helpful comments on earlier versions of this paper. Correspondence: Dimitrios Gounopoulos.
Long-term Performance of Greek IPOs
Version of Record online: 7 JUN 2010
© 2010 Blackwell Publishing Ltd
European Financial Management
Volume 18, Issue 1, pages 117–141, January 2012
How to Cite
Thomadakis, S., Nounis, C. and Gounopoulos, D. (2012), Long-term Performance of Greek IPOs. European Financial Management, 18: 117–141. doi: 10.1111/j.1468-036X.2010.00546.x
- Issue online: 27 DEC 2011
- Version of Record online: 7 JUN 2010
- initial public offerings;
- long-term performance;
- market efficiency
We analyse the long-run performance of 254 Greek IPOs that were listed during the period 1994–2002, computing buy-and-hold abnormal returns (BHAR) and cumulative abnormal returns (CAR) over 36 months of secondary market performance. The empirical results differ from international evidence and reveal long-term overperformance that continues for a substantial interval after listing. Measuring these returns in calendar time, we find statistical significance with several of the benchmarks employed. We also find that long-term overperformance is a feature of the mass of IPOs conducted during a pronounced IPO wave. Cross-sectional regressions of long-run performance disclose several significant factors. The study demonstrates that although Greek IPOs overperform the market for a longer period, underperformance eventually emerges, in line with much international evidence. Our interpretation is that the persistence of overperformance over a significant interval is due to excessive supply of issues during the ‘hot IPO period’. Results associated with pricing during the ‘hot IPO period’ indicate positive short- (1-year), medium- (2-year) and negative long-term (3-year) performance.