Long-Term Performance Of Foreign Food And Beverage Equities Traded On The New York Stock Exchange: A Look At Investment Opportunities

Abstract

Because of the growth of international trade and the increase in sales and profits in the food and beverage industry in recent years investors may believe there is a great opportunity to reap high returns from foreign equities.  Cumulative excess returns from all newly issued foreign food and beverage equities over a 36-month period following the date listed on the New York Stock Exchange are tested for significant differences in performance to determine whether they outperform the S & P 500 returns.  Although the 36-month cumulative excess returns are not significant, findings indicate that the food and beverage ADRs performed 13.55 percent lower than the S & P 500 Index which serves as a proxy for the market in general.  Food and beverage seasoned equity offerings outperformed initial public offerings.