Research

Inflation Pass-Through Heterogeneity and Firm Value (with Alexander F. Wagner)

Firms' heterogeneous inflation pass-through affects equity values when investors benchmark against headline inflation. High-pricing-power firms outperform during inflationary periods through two channels: lower cost of capital adjustments and perceived free cash flow resilience. Using 2009-2023 US data, we find firms with one-standard-deviation higher pricing power experience 12\% smaller stock price declines following inflation surprises. This effect operates through both reduced risk premia and higher future cash flows. Analysts fail to incorporate pricing power when revising earnings forecasts during inflation, generating systematic earnings surprises. These results offer new insights into inflation’s implications for asset pricing and valuation.

Link to paper (coming soon)

Conferences and Seminars (* scheduled): 2nd Lake District Workshop in Corporate Finance, Tri-City Bridge Workshop on Empirical Research in Finance 2025, AFA Annual Meeting 2025 (Poster Session), BBLS Seminar at the University of Zurich Fall 2024, SFI Research Days 2024.

The Role of Financial Markets in Corporate Inflation Transmission (single-authored)