Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments April 1, 2018 erstellt
Beschreibung:
We study the motives for long-term debt issues. The primary use of debt issue proceeds is repurchasing noncurrent debt. These repurchases combined with rollovers consume 57% of proceeds, so most debt issues are not used for investment and operations and do not impact leverage. Regardless of proceed use, debt issues are associated with overoptimistic analysts' earnings forecasts and subsequent earnings declines. Even among liquidity squeezed firms, earnings optimism is a deciding factor in issuance decisions, as lower optimism leads to fewer debt issues and reduced investment. Our findings suggest that firm-specific sentiment has a first-order impact on debt issue decisions