Covid-19: Corporate diversification and post-crash returns

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This paper examines the impact of corporate diversification on stock returns during and after the market crash caused by Covid-19. Using regression and survival analyses, we find that diversified firms experience worse returns and slower improvement in stock prices than focused firms. However, diversified firms trading at diversification premium have better returns and faster recovery compared to those trading at discount. Our findings presented here can be relevant to academics and industry professionals in their understanding of the role of corporate diversification in difficult times.
Original languageEnglish
Article number102501
JournalFinance Research Letters
Early online date16 Oct 2021
Publication statusEarly online date - 16 Oct 2021


  • Covid-19
  • stock market crash
  • excess value
  • corporate diversification
  • survival analysis


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