Rezvan Pourmansouri - Master of Business Administration - Financial Orientation
Roohollah Ghasemi - Master student of accounting, Razi University of Kermanshah

This study examines the importance of financial constraints and competition in the product market of the decision to repurchase shares in the period ۲۰۱۱-۲۰۱۲ in the Iranian financial markets. This research has been examined in a statistical sample of ۱۲۰ companies. We have found that firms with financial constraints are more likely to repurchase shares with debt financing; however, firms without financial constraints are more likely to make redemption purchases with debt financing only when debt market conditions are favorable. We also found that the level of industry competition is an important factor in managers' decisions. Highly competitive companies, therefore, pay their extra cash through redemption of shares, which is stronger in times of financial crisis

Effects of financial constraints, product market competition, stock repurchases