Shares repurchases regarded as an important financial decision can timely and accurately reflect the actual corporate value to investors, and make investors have positive attitude to the share prices to safeguard the shareholders’ interests, but the domestic and foreign scholars viewed the differences on various short-term shares repurchases announcement without the rates of market share and market growth. Therefore, the study uses BCG models to examine the differential responses of investors on shares repurchases announcements when share price is undervalued.
The empirical results show that of Stars, Cash Cows, Questions, and Dogs exhibt significant and negative abnormal returns during the pre-announcement period.However, after it, the share prices have positive reaction. Both AR and CAR are positive and achieve a statistically significant level. Furthermore, among them, Dogs which have low rates of market share and market growth have the highest CAR after the announcements, Cash Cows second, followed by Questions, and the lowest is Stars.
