[theli0nheart]

The key takeaway for me is that layoffs are an effect, not a cause, of company failure.

The quoted text is a good example of this. If a company is struggling strategically or economically, and doesn't do a layoff, it's just going to struggle more, and fail more quickly. Companies that aren't laying people off are likely not even considering layoffs, because their businesses are actually doing well.

So, it's pretty obvious to me that companies in that cohort would see the biggest stock price appreciation, because layoffs are an indicator of poor future performance.

[hinkley]

Layoffs are an effect of unsustainable success.

If you can lay off people without cratering the company, it means you hired too many people in the first place.