Areas of Expertise (7)
Jonathan Cohn is an associate professor in the Department of Finance whose research interests include corporate governance, incentives and performance evaluation, private equity, and financial market regulation. In 2012 he was awarded the Best Paper on Corporate Finance and he has twice been awarded for teaching excellence in the MBA program.
University of Michigan: Ph.D., Finance 2008
Washington University in St. Louis: MBA, Business Administration 2002
University of Alabama at Birmingham: BS, Management 1997
Media Appearances (5)
Real Returns: Are Private-Equity Gains Built to Last?
The Wall Street Journal online
A new study shows that one of the chief benefits of private-equity firms is largely an illusion.
Activist Investors Cause Headaches for Boards, Boost Value for Stockholders
Texas Enterprise | Big Ideas in Business online
Cohn looks at activist investors to see how their presence affects a company’s stock price. His findings show that stockholders have reason to welcome these corporate gadflies. Not only can activist investors tip the balance of power toward shareholders, but they might even raise their stock returns.
Where's the Shareholder Outrage at Hewlett-Packard?
Bloomberg Businessweek online
How have Hewlett-Packard (HPQ) shareholders largely remained so silent while board infighting, botched multi-billion-dollar acquisitions, multiple strategic false starts, and high C-Suite turnover have combined to lop off more than $90 billion of market valuation—the venerable tech company is now worth just $28 billion—since the end of 2009?
The Power of the 'Passive-Aggressive' Shareholder
There’s a case to be made that activist investors are great for both the shareholders and managers at companies they partially own but aren’t trying to take down.
How Wall Street’s short-term focus can bring you long-term stock gains
I base my skepticism on an academic study published several years ago in the prestigious Journal of Financial Economics: “The Evolution of Capital Structure and Operating Performance after Leveraged Buyouts: Evidence from U.S. Corporate Tax Returns,” by Jonathan Cohn and Lillian Mills, both from the University of Texas at Austin, and Erin Towery of the University of Georgia.
We present evidence that financing frictions adversely impact investment in workplace safety, with implications for worker welfare and firm value. Using several identification strategies, we find that injury rates increase with leverage and negative cash flow shocks, and decrease with positive cash flow shocks. We show that firm value decreases substantially with injury rates. Our findings suggest that investment in worker safety is an economically important margin on which firms respond to financing constraints.
We use events related to a proxy access rule passed by the Securities and Exchange Commission in 2010 as natural experiments to study the valuation effects of changes in shareholder control. We find that valuations increase (decrease) following increases (decreases) in perceived control, especially for firms that are poorly performing, have shareholders likely to exercise control, and where acquiring a stake is relatively inexpensive.
This paper investigates the effects of analyst recommendations issued after a merger announcement on deal completion. We find the probability of completion increases (decreases) with the favorability of acquirer (target) recommendations. We also find that favorably recommended firms in a proposed merger underperform following deal resolution, suggesting that investors overreact to postmerger announcement recommendations.
[Recepient of Charles River Assoc. Award for the Best Paper on Corporate Finance, 2012 Western Finance Assoc.] This study uses corporate tax return data to examine the evolution of firms' financial
structure and performance after leveraged buyouts (LBOs) for a comprehensive sample of
317 LBOs taking place between 1995 and 2007. We find little evidence of operating ...
This paper investigates the effects of analyst recommendations issued after a merger announcement on deal completion. We find the probability of completion increases (decreases) with the favorability of acquirer (target) recommendations.
We provide a model of governance in which a board arbitrates between an activist
investor and a manager facing reputational concerns. The optimal level of internal board
governance depends on both the severity of the agency conflict and the strength of ...