scholarly journals The Level of Diversification on the Firms of the Iberian Market

2021 ◽  
Vol 18 ◽  
pp. 978-985
Author(s):  
Gualter Couto ◽  
João Cabral ◽  
Pedro Pimentel ◽  
Rui Alexandre Castanho
Keyword(s):  
Negative Impact ◽  
Corporate Diversification ◽  
Tobin’S Q ◽  
Herfindahl Index ◽  
Continuous Change ◽  
Tobin's Q ◽  
Book Value ◽  
Diversification Strategies ◽  
Security Device ◽  
Diversified Firms

It is a fact that a company’s durability may depend on its capacity to readjust to a world in continuous change. Diversification strategies should be a security device, reduce the risk, and at the same time, search for possible profitable opportunities. Therefore, when a diversified firm follows one of its business sections and realizes that the performance is worse than foreseen, this negative impact may be diminished by other segments with better performance. Contextually, the current study aims to determine a correlation between value and corporate diversification in the Iberian market. We use Tobin’s Q as the measure for value and the Herfindahl Index to measure diversification. In addition to the study of correlation, this paper also analyses the level of diversification for the firms that integrate the Iberian market and if their market value is above or below their book value. Using these metrics, we found a negative correlation between value and diversification in the Iberian Market. In our sample, we also found that highly diversified firms performed worse than focused firms on average. In the Portuguese sample, we were able to determine the level of diversification that maximizes the Tobin’s Q of a firm. According to Tobin's Q, our sample was characterized by a low level of diversification in general and that the companies were slightly overvalued.

Do corporate diversification and earnings management practices affect capital structure?

2015 ◽  
Vol 7 (4) ◽  
pp. 360-378 ◽  
Author(s):  
Ranjitha Ajay ◽  
R Madhumathi
Keyword(s):  
Capital Structure ◽  
Earnings Management ◽  
Management Practices ◽  
Negative Relationship ◽  
Corporate Diversification ◽  
Content Type ◽  
Diversification Strategies ◽  
Market Product ◽  
Diversified Firms ◽  
The Impact

Purpose – The purpose of this paper is to empirically examine the impact of earnings management on capital structure across firm diversification strategies. Design/methodology/approach – The study focuses on firms operating in the manufacturing sector (diversified and focused). Panel data methodology compares diversification strategies and identifies the impact of diversification strategy with earnings management practices on capital structure decision. Findings – International and product diversified firms have lower levels of leverage than focused firms in their capital structure. Asset-based earnings management is positive for diversified (market/product) firms. Earnings management using discretionary expenditure (project based) is found to be higher for market diversified but product-focused firms. Earning smoothing method is found to be significant for focused firms and shows a negative relationship with capital structure. Originality/value – This study offers an insight into the relationship between corporate diversification, earnings management and capital structure decisions of manufacturing firms. The results provide an important contribution to accounting and strategy literature. A distinction is made between market- and product-diversified firms and influence of earnings management practices (asset-based, project-based and earnings smoothing (ESM)) on capital structure decisions. Diversified firms (market/product) tend to have lower levels of leverage than focused firms and earnings management practices within firm groups significantly influence the capital structure decisions.

scholarly journals TRADEMARK ACTIVITY AND THE MARKET PERFORMANCE OF U.S. COMMERCIAL BANKS

2012 ◽  
Vol 13 (5) ◽  
pp. 931-950 ◽  
Author(s):  
Carlos González-Pedraz ◽  
Sergio Mayordomo
Keyword(s):  
Commercial Banks ◽  
Negative Impact ◽  
Abnormal Returns ◽  
Market Value ◽  
Tobin’S Q ◽  
Tobin's Q ◽  
Cumulative Abnormal Returns ◽  
And Performance ◽  
Positive Effect

This empirical paper analyzes the effect of trademark activity on the market value and performance of US commercial banks from two perspectives. First, a longterm perspective considers the effect of such activity on banks’ Tobin's q. Second, with a short-term perspective, the authors analyze the effect of trademark activity on banks’ abnormal returns. An older portfolio of trademarks diminishes the ratio of market value to firm assets, but this ratio can be improved in the long term by abandoning old trade-marks. Portfolios of trademarks with wide diversification do not help increase Tobin's q. Furthermore, according to an event study, the creation of a trademark has a positive effect on cumulative abnormal returns compared with no event, whereas a cancellation event has a negative impact.

Effect of Financial Leverage on Firm's Market Value Creation in Bangladesh

2017 ◽  
Vol 4 (2) ◽  
pp. 41-58
Author(s):  
Syed Md. Khaled Rahman
Keyword(s):  
Value Creation ◽  
Tobin’S Q ◽  
Financial Leverage ◽  
Tobin's Q ◽  
Book Value ◽  
Explanatory Variables ◽  
Basic Objective ◽  
Equity Ratio ◽  
The Impact ◽  
Domestic Companies

This article contends that a firm's performance is affected by various factors and capital structure is one of the factors among them. The basic objective of the research is to analyze and compare the impact of financial leverage on firms' Market to Book Value (MV/BV) and Tobin's Q ratio of DSE-listed MNCs & domestic firms of Bangladesh over a 20-year period (1996-2015). Explained variables are Market to Book Value (MV/BV) and Tobin's Q ratio. Explanatory variables of the interest are indicators of six financial leverage ratios. MV/BV is negatively related with leverage ratios of both types of companies. Domestic companies' MV/BV decreases by 0.016 times for 1% increase of debt ratio while MNCs' MV/BV decreases by 0.048 times for 1% increase of debt-equity ratio and vice-versa. With debt-equity ratio, domestic companies' Tobin's Q is positively related while that of MNCs is negatively related.

scholarly journals PENGARUH GOOD CORPORATE GOVERNANCE TERHADAP KINERJA DAN NILAI PERUSAHAAN (STUDI PADA PERUSAHAAN YANG TERINDEKS OLEH CGPI

2016 ◽  
Vol 3 (1) ◽  
pp. 1-10
Author(s):  
EVA MARIA SULASTRI
Keyword(s):  
Corporate Governance ◽  
Tobin’S Q ◽  
Return On Assets ◽  
Tobin's Q ◽  
Return On Equity ◽  
Book Value ◽  
Good Corporate Governance

Penelitian ini bertujuan untuk menganalisis pengaruh good corporate governance terhadap kinerja perusahaan dan nilai perusahaan yang dapat dijadikan acuan manajemen dalam menggunakan tata kelola yang baik dan tepat sehingga dapat menguntungkan perusahaan secara keseluruhan. Populasi pada penelitian ini menggunakan seluruh perusahaan yang terdaftar di Bursa Efek Indonesia dengan sampel perusahaan yang masuk dalam indeks CGPI dengan jumlah sampel 91 perusahaan. Variabel yang digunakan pada penelitian ini yaitu good corporate governance yang diproksikan dengan CGPI, kinerja perusahaan yang menggunakan proksi Return On Assets (ROA) dan Return On Equity (ROE), sedangkan nilai perusahaan menggunakan TOBIN’S Q dan Market to Book Value (MBVR). Penelitian ini menggunakan alat analisis regresi linear yang berfungsi untuk mengetahui pengaruh antara good corporate governance, kinerja perusahaan dan nilai perusahaan. Hasil dari penelitian ini menunjukkan bahwa good corporate governance berpengaruh positif signifikan terhadap kinerja perusahaan, good corporate governance berpengaruh positif signifikan terhadap nilai perusahaan yang diproksikan dengan MBVR sedangkan jika diproksikan dengan TOBIN’S Q tidak berpengaruh, pengaruh kinerja perusahaan terhadap nilai perusahaan memberikan beberapa hasil, ROA berpengaruh positif signifikan terhadap TOBIN’S Q kemudian ROE tidak berpengaruh terhadap TOBIN’S Q dan ROA serta ROE tidak berpengaruh terhadap MBVR.   Kata Kunci: good corporate governance, return on assets, return on equity, TOBIN’S Q dan market to book value

scholarly journals Corporate Governance Practices and Bank Performance: Evidence from Indian Banks

2020 ◽  
Vol 4 (1) ◽  
pp. 33-41
Author(s):  
Brahmaiah Bezawada
Keyword(s):  
Corporate Governance ◽  
Banking Industry ◽  
Negative Impact ◽  
Positive Impact ◽  
Negative Relationship ◽  
Bank Performance ◽  
Tobin’S Q ◽  
Board Size ◽  
Tobin's Q ◽  
Governance Practices

The study examines the corporate governance practices and analyzes the role of the board characteristics (size of the board, the composition of the board, and functioning of the board) on the performance and asset quality of banks. We use a sample of 34 commercial banks consisting of 19 public sector banks and 15 private sector banks from 2009 to 2018 accounting for 93 percent of the total banking industry in India. The study finds that busy directors and the number of meetings have a positive significance on bank performance. The percentage of independent directors and the percentage of busy directors influence a significant negative relationship on the net non-performing assets ratio. The board size and number of meetings are associated negatively with Tobin's Q significantly and the percentage of busy directors is a significantly positive impact on Tobin's Q. The board size has a significantly negative impact on bank performance. The research findings provide some insights into corporate governance to the RBI for considering appropriate policy guidelines on corporate governance in the banking industry in India. The paper adds to the existing literature on corporate governance mechanisms and banking industry performance.  

scholarly journals Corporate Governance and Company Value: A Manufacturing Industry Case Study

2021 ◽  
Vol 4 (4) ◽  
pp. 450-461
Author(s):  
Helma Malini ◽  
Dyen Natalia ◽  
Giriati Giriati
Keyword(s):  
Corporate Governance ◽  
Panel Data ◽  
Audit Committee ◽  
Manufacturing Industry ◽  
Random Effect ◽  
Random Effect Model ◽  
Tobin’S Q ◽  
Tobin's Q ◽  
Book Value ◽  
The Impact

The purpose of this research is to look into the impact of corporate governance in the Indonesia Stock Exchange's Manufacturing Industry. Panel data from 73 Manufacturing Industry companies on the Indonesia Stock Exchange from 2014 to 2018 with a total of 365 observations of data whose research results were analyzed using panel data regression analysis with the Random Effect Model approach. Institutional ownership has a positive effect on Tobin's q and market book value, according to the study's findings. Tobin's q and market book value are negatively affected by foreign ownership. Meetings of the Board of Commissioners and the Audit Committee have a negative impact on stock price returns. Meetings of the board of directors, audit committee, and board of commissioners were found to have no impact on the value of the company. On the basis of these findings, it can be concluded that the results of testing the independent variables on the dependent are inconclusive and should be questioned further.

Penggunaan Value Added Intellectual Capital (VAIC) Sebagai Prediktor Nilai dan Kinerja Keuangan Perusahaan (Studi Empiris Pada Perusahaan di Sektor Miscellaneous, Consumer Goods Property, Real Estate & Building Construction dan Infrastructure, Utilities

2019 ◽  
Vol 1 (2) ◽  
pp. 127-144
Author(s):  
Firman Adnan ◽  
Josephine Sudiman
Keyword(s):  
Real Estate ◽  
Intellectual Capital ◽  
Consumer Goods ◽  
Value Added ◽  
Building Construction ◽  
Tobin’S Q ◽  
Tobin's Q ◽  
Return On Equity ◽  
Book Value ◽  
Price Earnings Ratio

Penelitian ini dilatarbelakangi oleh perkembangan ilmu penge-tahuan dan teknologi yang menyebabkan banyaknya perusahaan membuat strategi bisnis berbasis ilmu pengetahuan yaitu intellec-tual capital (IC). Salah satu pengukuran yang dapat digunakan untuk mengukur IC adalah VAICTM yang dikembangkan oleh Pulic (2000). Tujuan dari penelitian ini adalah untuk menganalisa pengaruh antara intellectual capital terhadap nilai dan kinerja keuangan perusahaan. Metode penelitian yang digunakan adalah metode regresi linear sederhana. Sampel dari penelitian ini adalah perusahaan yang terdapat pada sektor miscellaneous, consumer goods, property dan infrastructure yang terdaftar di Bursa Efek Indonesia periode 2015 sampai 2018. Hasil dari penelitian ini menunjukkan bahwa IC hanya mampu menjadi prediktor terhadap kinerja keuangan yang diukur dengan menggunakan return on asset (ROA) dan return on equity (ROE), sedangkan IC tidak mampu menjadi prediktor terhadap nilai perusahaan yang diukur menggunakan price book value (PBV), price earnings ratio (PER) dan tobin’s Q (Q).

Understanding the effects of economic policy uncertainty on US tourism firms’ performance

2021 ◽  
pp. 135481662098314
Author(s):  
Conrado Diego García-Gómez ◽  
Ender Demir ◽  
Ming-Hsiang Chen ◽  
José María Díez-Esteban
Keyword(s):  
Economic Policy ◽  
Firm Performance ◽  
Negative Impact ◽  
Generalized Method Of Moments ◽  
High Growth ◽  
Policy Uncertainty ◽  
Tobin’S Q ◽  
Tobin's Q ◽  
Economic Policy Uncertainty ◽  
The Impact

This study analyzes the impact of economic policy uncertainty (EPU) on the performance of US tourism firms using a sample of 296 publicly traded tourism companies from 2000 to 2018 with a sample of 3068 firm-year observations. Estimation results of panel regressio tests based on the system-generalized method of moments indicate that EPU has a negative impact on return on assets (ROA), return on equity (ROE), and Tobin’s Q. Our results are consistent for different variable specifications. We also find that firm size and leverage play a moderating role in the relationship between EPU and firm performance. Panel quantile regression results show that the impact of EPU on US tourism firm performance is asymmetric. Specifically, low-performing (25% quantile of ROA and ROE) firms are less affected by EPU, and for the case of Tobin’s Q, EPU does not affect firms with a high growth opportunity (100% quantile of Tobin’s Q).

scholarly journals An Evaluation of Corporate Governance Characteristics and Corporate Performance between Government-Linked Companies (GLCs) in Malaysia and Singapore: A Panel Data Analysis

2021 ◽  
Vol 124 ◽  
pp. 04005
Author(s):  
Ng Ching Yat David ◽  
Lau Teck Chai ◽  
Tee Peck Ling ◽  
Lai Siew Fong
Keyword(s):  
Corporate Governance ◽  
Negative Impact ◽  
Panel Data Analysis ◽  
Listed Companies ◽  
Independent Directors ◽  
Tobin’S Q ◽  
Women Directors ◽  
Tobin's Q ◽  
Significant Negative Impact ◽  
The Government

This research seeks to investigate whether corporate governance contributes to the Government-link public listed companies’ performance in Malaysia and Singapore. A sample consisting of 20 Malaysian Government-linked public listed companies and 20 Singaporean Government-linked public listed companies were selected. The research timeframe covers from 2012 to 2017. Findings revealed that except for board meetings and independent directors, 4 other independent variables were statistically significant in affecting the Malaysian and Singaporean government-link public listed companies’ performance. Directors’ ownership had a significant negative impact on ROA and ROE in Malaysia but had no impact in Singapore. Board meetings and independent directors had no impact towards firm performance in both countries. Board size had positive and significant impact on ROE in Singapore. Number of women directors was significantly negatively related to Tobin’s Q, ROA and ROE. Leverage level was significantly negatively related to all firm performance’s measures in Malaysia, while only significantly related to Tobin’s Q in Singapore.

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