Dual-Class Firms Have Higher Market Valuations near Time of IPO That Drop over Next Six Years, Study Finds
Facebook, Google, Comcast and Berkshire Hathaway are among a number of large companies that have dual-class stock structures, providing controlling shareholders with majority voting power despite owning a minority of total equity.
For these dual-class firms, market valuations are higher early in their life cycles, while the valuation premium tends to disappear about six years after their IPOs, according to new research from the University of Notre Dame.
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April 18, 2018