Analyzing the Short-term and Long-term Effects of Mergers and Acquisitions on Stock Prices: A Comprehensive Study of Acquiring and Target Companies

Abstract

In this study, Microsoft’s acquisition of linkedin on June 13, 2016 is taken as the research object, focusing on the impact of mergers and acquisitions on stock prices. A hybrid approach is adopted, combining quantitative analysis of stock price data and financial performance indicators with qualitative evaluation of strategic results. Preliminary results show that the stock price fluctuated in the short term after the merger event, but then gradually stabilized. This paper emphasizes that this research provides valuable insights for business decision makers, investors and financial analysts. More importantly, this study provides empirical evidence to support the trend that M&A gradually stabilizes after short-term fluctuations in stock prices, and provides a practical basis for understanding the impact of M&A on corporate strategic decision-making. Therefore, this work not only has guiding significance for the decision-making of investors, but also provides an important reference for the formulation of corporate strategy, and helps to improve the decision-making wisdom of decision makers.