Rate of return on new invested capital—Its relationship to corporate earnings growth rate and equity market values

1972 ◽  
Vol 5 (4) ◽  
pp. 33-42
Author(s):  
Calvin S. Moore
Keyword(s):  
Growth Rate ◽  
Equity Market ◽  
Rate Of Return ◽  
Earnings Growth ◽  
Market Values ◽  
Corporate Earnings

SFAS No. 123 Stock-Based Compensation Expense and Equity Market Values

2004 ◽  
Vol 79 (2) ◽  
pp. 251-275 ◽  
Author(s):  
David Aboody ◽  
Mary E. Barth ◽  
Ron Kasznik
Keyword(s):  
Equity Market ◽  
Share Price ◽  
Net Income ◽  
Book Value ◽  
Earnings Growth ◽  
Market Values ◽  
Option Values ◽  
Expected Earnings ◽  
Instrumental Variables Approach ◽  
Perceived Costs

This study investigates the relation between share price and stock-based compensation expense that is disclosed but not recognized under SFAS No. 123, after controlling for net income, equity book value, and expected earnings growth. Our instrumental variables approach controls for the mechanical relation between share price and option values. We find that investors view SFAS No. 123 expense as an expense of the firm, and as sufficiently reliable to be reflected in their valuation assessments. Findings based on annual returns indicate SFAS No. 123 expense reflects on a timely basis changes in investor-perceived costs associated with stock-based compensation.

scholarly journals The Rate of Return on Everything, 1870–2015*

2019 ◽  
Vol 134 (3) ◽  
pp. 1225-1298 ◽  
Author(s):  
Òscar Jordà ◽  
Katharina Knoll ◽  
Dmitry Kuvshinov ◽  
Moritz Schularick ◽  
Alan M Taylor
Keyword(s):  
Growth Rate ◽  
Rate Of Return ◽  
Annual Data ◽  
Real Rate ◽  
Data Set ◽  
Long Run ◽  
Advanced Economies ◽  
New Findings ◽  
Asset Classes ◽  
New Evidence

Abstract What is the aggregate real rate of return in the economy? Is it higher than the growth rate of the economy and, if so, by how much? Is there a tendency for returns to fall in the long run? Which particular assets have the highest long-run returns? We answer these questions on the basis of a new and comprehensive data set for all major asset classes, including housing. The annual data on total returns for equity, housing, bonds, and bills cover 16 advanced economies from 1870 to 2015, and our new evidence reveals many new findings and puzzles.

scholarly journals Dividend Aristocrats – A Comparative Analysis of Polish and American Dividend Companies During the Period of 2009–2017

2020 ◽  
Vol 20 (1) ◽  
pp. 190-205
Author(s):  
Bartłomiej Jabłoński
Keyword(s):  
Growth Rate ◽  
Comparative Analysis ◽  
Standard Deviation ◽  
Stock Exchange ◽  
Rate Of Return ◽  
Average Annual Rate ◽  
Dividend Payments ◽  
Statistical Measures ◽  
Similarities And Differences ◽  
Dividend Growth

AbstractResearch background: This article describes the issue of dividend companies that are components of the WIG index and S&P 500 during the period 2009–2017.Purpose: The aim of the study was to identify similarities and differences in dividend payments by issuers during the period 2009–2017.Research methodology: It describes the assessment of investments in companies on the basis of the continuity and variability of dividends paid (taking into account the rate of dividend growth and the cumulated rate of dividends, statistical measures – median and standard deviation), as well as the comparison of issuers from the Polish and US stock exchange.Results: The results of the study confirm the existence of differences in dividend pay-outs by companies listed on both exchanges.Novelty: First of all, Polish dividend companies are characterised by a higher average annual dividend growth rate and an average annual rate of return. What is more important, the average accumulated dividend (as well as its median) of companies from the WIG index is higher than the same group of companies belonging not only to the S&P 500 index companies, but also to American dividend aristocrats.

scholarly journals Volatility behavior of virtual currencies

2019 ◽  
Vol 10 (2) ◽  
pp. 537
Author(s):  
Jéssica Gonçalves Andrade ◽  
Nilson Brandalise
Keyword(s):  
Growth Rate ◽  
Data Analysis ◽  
Average Rate ◽  
Rate Of Return ◽  
Average Risk ◽  
Average Growth Rate ◽  
Average Growth ◽  
Volatility Analysis ◽  
One Year ◽  
Made In

In order to do a volatility analysis, since the exchange rate is higher than the average risk, the higher the average rate of return, the higher the average growth rate of the year. applied the method of data analysis. An attempt to volatility analysis can be made in one year, in the middle of the end of 2016.

scholarly journals The PE Ratio and the Predicted Earnings Growth – the Case of Poland

2015 ◽  
Vol 15 (1) ◽  
pp. 127-138
Author(s):  
Radosław Kurach ◽  
Tomasz Słoński
Keyword(s):  
Normal Level ◽  
Capital Market ◽  
Average Rate ◽  
Equity Returns ◽  
Rate Of Return ◽  
Future Prospects ◽  
Earnings Growth ◽  
The Individual ◽  
Pe Ratio ◽  
Correct Signal

Abstract We examine the components of equity returns on the Polish capital market. To analyse the underlying complexity of returns we took into consideration the model designed by Leibowitz (1999). This model captures three factors: dividend yield, expected growth in earnings and expected change in price-to-earnings (PE) ratio. We applied this model to analyse the average discount/premium not only to particular shares but to market averages as well. Firstly, we examined the variation of PE across the companies (as adapted from Penman (1996)) to analyse the average rate of return and their striking distance of individual stocks from a ‘normal’ level. Then we checked the transitory earnings in the portfolios of high PE, whereby a fall in current earnings relative to sustainable level of earnings leads to a transitory high PE ratio. We expect that the effect of transience in current year earnings can be significant. Lastly, we analysed the individual companies in order to check what percentage of companies give a “correct” signal about future prospects.

scholarly journals The Impact of the Debt Ratio, Total Assets, and Earning Growth Rate on WACC: Evidence from Nepalese Commercial Banks

2020 ◽  
pp. 16-23
Author(s):  
Prem Bahadur Budhathoki ◽  
Chandra Kumar Rai
Keyword(s):  
Growth Rate ◽  
Commercial Banks ◽  
Predictor Variable ◽  
Ordinary Least Squares ◽  
Predictor Variables ◽  
Debt Ratio ◽  
Earning Growth ◽  
Earnings Growth ◽  
The Impact ◽  
Made In

This study examined the impact of the debt ratio, total assets, and earnings growth rate on banks’ WACC. This study employed bank scope data of twenty-eight commercial banks during the single period of 2018. Altogether, there were 28 observations were made in the study. The ordinary least squares model was used to analyze the data. The results indicated that two predictor variables debt ratio and total assets significantly affected the bank’s WACC. But the predictor variable earnings growth rate did not significantly affect banks’ WACC. The results of this study could help bankers and policymakers to take effective action to reduce banks’ WACC.

scholarly journals Earnings growth and the wealth distribution

2021 ◽  
Vol 118 (15) ◽  
pp. e2025368118
Author(s):  
Thomas J. Sargent ◽  
Neng Wang ◽  
Jinqiang Yang
Keyword(s):  
Interest Rate ◽  
Wealth Distribution ◽  
Power Laws ◽  
Rate Of Return ◽  
Cross Sectional ◽  
Earnings Growth ◽  
Gini Coefficients ◽  
Joint Distributions ◽  
Labor Earnings ◽  
Saving Decisions

As measured by Gini coefficients, fractile inequalities, and tail power laws, wealth is distributed less equally across people than are labor earnings. We study how luck, attitudes that shape saving decisions, and growth rates of labor earnings balance each other in ways that simultaneously shape joint distributions across people of labor earnings, age, and wealth together with an equilibrium rate of return on savings that plays a pivotal role in balancing contending forces. Strong motives for people to save and for firms to demand capital raise an equilibrium interest rate enough to make wealth grow faster than labor earnings. That makes cross-sectional wealth more unevenly distributed and have a fatter tail than labor earnings, as in US data.

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