Stock analysis Essay Example | Topics and Well Written Essays - 4500 words

Stock analysis - Essay ExampleThis includes, but is not limited to, the background of IHG and a apprize statement of four special informational events which go away be analyzed in depth within this brief response. Accordingly, a literature review will be shown which helps to underscore and elaborate upon many of the specific theoretical interpretations of the methods utilized within this report as well as relate pertinent information with regards to how such a process has been traditionally understood. Additionally, a demonstration of development of an event study is included and defined. Furthermore, the third part of the piece will include a methodological review. The explanations of approaches which have been utilized to conduct this report will be given as well as some assumptions and critical common factors that atomic number 18 associated with this methodology. Likewise, a research design and results section will comprise the fourth part of this analysis. Ultimately, the is sues which will be explored and/or discussed will be analyzed base upon an event study methodology. This part will begin with defining the date of events and then choose the estimated period and test period. Following this, marker models will be chosen as a specific benchmark for abnormal returns. Similarly, a linear regression for the market will be chosen to shed pull ahead light on the theoretical interpretation and key data presented. In such a way, ordinary least square assumptions will be required to estimate the stability or whether or not it exists to a discernible degree at all. Based on the results of linear regression, the abnormal return will be calculated. Next, the Cumulative abnormal return, or CAR will be utilized as a means of indicating the effect of events specific to those which have already been related and identified. Further, a T-test by CAR will be presented to show the significant of these events. A final portion of the research will necessarily be the co nclusion of this report. Within this conclusion, it is the intent of this researcher to show the basic information of this report and summarize it according to the inference which has been drawn. Background information InterContinental Hotels assembly (IHG) is global hotel group which operates nine hotel brands which in turn comprise a total of 4,600 hotels in more than 100 countries and regions, more than 676,000rooms. IHG was established in 1946 and is the worlds largest and most widely distributed network of professionally managed hotels. With regards to the business model that IHG exhibits, this can be understood in three distinct ways. First, IHG operates as a franchisor, second as a management accessory, and thirdly it operates upon a rental basis. In addition, the franchise has been recognized as exhibiting an effective business philosophy by many leadership within the industry. This report chose four specific events to explore the relationship with the IHG stock price vola tility for a period time. These four events are shown below (1) On the 1eighth April 2012 IHG shows its support for small business owners, entrepreneurs and Road Warriors. (2) On the 7th August 2012 IHG reported interim results from the 30th June 2012 and announced $1bn return of capital. (3) On the 8th October 2012 IHG reported the results of general meeting about Special Dividend and Share Consolidation. (4) On the 12th November 2012 IHG announced that