scholarly journals The relative importance of financial ratios in creating shareholders’ wealth

2012 ◽  
Vol 15 (4) ◽  
pp. 416-428 ◽  
Author(s):  
Merwe Oberholzer
Keyword(s):  
Technical Efficiency ◽  
Significant Relationship ◽  
Market Value ◽  
Relative Importance ◽  
Manufacturing Companies ◽  
Return On Assets ◽  
Cross Sectional ◽  
Return On Equity ◽  
Scarce Resources ◽  
Sectional Analysis

The purpose of the study is firstly to use Data Envelopment Analysis (DEA) to aggregate the overall performance (technical efficiency) of firms to convert scarce resources into outputs that create wealth for shareholders, and secondly, to determine the degree to which this mentioned performance is reflected in a number of profitability and market value ratios. Annual financial statement data were used for 55 manufacturing companies listed on the JSE Limited over a five-year period in a cross-sectional analysis. The study found that return on equity has the most significant relationship with technical efficiency, followed by return on assets. The market value ratios price/earnings and dividend yield have no significant relationship with technical efficiency. The value of this study is that it is the first of its kind where technical efficiency, which aggregated operating, profitability and marketability efficiencies, is used to determine the relative importance of not only the readily available profitability ratios, but also market value ratios.

scholarly journals Effect of DER, ROA, ROE, EPS and MVA on Stock Prices in Sharia Indonesian Stock Index

2019 ◽  
Vol 4 (1) ◽  
pp. 15-22
Author(s):  
Martina Rut Utami ◽  
Arif Darmawan
Keyword(s):  
Stock Prices ◽  
Panel Data Analysis ◽  
Value Added ◽  
Market Value ◽  
Stock Index ◽  
Manufacturing Companies ◽  
Return On Assets ◽  
Return On Equity ◽  
Equity Ratio ◽  
Market Value Added

The research examine the effect of debt to equity ratio, return on assets, return on equity, earning per share, market value added on stock prices in manufacturing companies listed in Indonesian Sharia Stock Index. The purposive sampling method is used in our research, resulted 53 companies as the samples with 265 observations. The research used data during 2012-2016 from Indonesia Stock Exchange database with panel data analysis. The research found that, earning per share and market value added have a positive effect on stock prices, but different results for the variables debt to equity ratio, return on assets and return on equity partially have no effect on stock prices.

scholarly journals Correlation between the DJSI Chile and the Financial Indices of Chilean Companies

2020 ◽  
Vol 8 (4) ◽  
pp. 74
Author(s):  
Karime Chahuán-Jiménez
Keyword(s):  
Sustainable Management ◽  
Stock Price ◽  
Price Index ◽  
Market Value ◽  
Great Effort ◽  
Return On Assets ◽  
Return On Equity ◽  
Financial Variables ◽  
Dow Jones Sustainability Index ◽  
Financial Indices

The Dow Jones Sustainability Index Chile (DJSI Chile) is made up of leading sustainability companies that are investing great effort into sustainable management. This study correlates the DJSI Chile with the financial indices (return on equity (ROE), return on assets (ROA), market value, earnings, and leverage) of companies that belong to the General Stock Price Index (IGPA) in Chile. The methodology used was quantitative, considering Chilean companies in the IGPA, including companies belonging to the DJSI Chile, applying a normality and correlation test based on the results. In conclusion, the study shows that in the results for the ROE, ROA, and leverage variables, there is no positive correlation with the DJSI Chile. However, the DJSI Chile is correlated with market value (for approximately 80% of the companies), and with earnings, there is a slightly higher correlation for the companies that belong to the DJSI Chile than for the remaining companies in the IGPA, thus if there exists a correlation between the DJSI Chile index and the variables market value and earnings, the index enables the prediction of those financial variables or predicts the finance indices (value market and earnings) of the companies that make up the DJSI Chile basing in the DJSI Chile index.

scholarly journals An Interaction between Firm Strategy, Capital Structure and Firm’s Performance

2015 ◽  
Vol 7 (4(J)) ◽  
pp. 37-47
Author(s):  
Suresh Ramakrishnan ◽  
Saqib Muneer . ◽  
Melati Ahmad Anuar .
Keyword(s):  
Firm Performance ◽  
Capital Structure ◽  
Cash Flow ◽  
Significant Relationship ◽  
Corporate Strategy ◽  
Firm Strategy ◽  
Free Cash Flow ◽  
Sales Growth ◽  
Return On Assets ◽  
Return On Equity

The study tries to determine the association among corporate strategy, social structure and firm performance. In this regard, the monetary reports of 78 companies listed in Karachi Stock Exchange since 2007 to 2014 were scrutinized. In this research, firm strategy (sales growth, liquidity) and capital structure (debt ratio) were used as sovereign variables, and firm performance (return on equity, return on assets, free cash flow for the firm, free cash flow per share) were functional and are used as dependent variables, so to study the affiliation between corporate strategy, capital structure and firm performance within a 8-years period from 2007 to 2014. Secondary data has been used to test the hypotheses; single variable linear regression method was used and their significance was evaluated using Statistics T (t-test) and F (Fisher). The study results indicate that there is a significant positive relationship between sales growth variables and two types (among four types) of performance criteria in the study, namely return on equity and return on assets. And there is a positive significant relationship between firm liquidity and three criteria of firm's performance in the study namely return on equity, free cash flow per share and return on assets. Also, debt ratio has a positive significant relationship with free cash flow for firm and a negative significant relationship with return on assets.

scholarly journals The Effect of Financial Performance Measured With Rentability Ratio Against Dividend Payout Ratio (Empirical Study on Manufacturing Companies Group Listed on BEI)

2018 ◽  
Vol 2 (01) ◽  
Author(s):  
Imas Della Fauzi ◽  
Rukmini Rukmini
Keyword(s):  
Financial Performance ◽  
Return On Investment ◽  
Hypothesis Test ◽  
Profit Margin ◽  
Manufacturing Companies ◽  
Return On Assets ◽  
F Test ◽  
Dividend Payout ◽  
Return On Equity ◽  
Net Profit

This study aims to examine whether there is a significant effect of the company's financial performance as measured by the ratio of profitability with Return on Assets (ROA), Return On Equity (ROE), Return On Investment (ROI) and Net Profit Margin (NPM) to Dividend Payout Ratio (DPR). The data collected is obtained from the financial statements of manufacturing companies listed on the Indonesia Stock Exchange period 2013-2015. The analysis used to know how big the influence of ROA, ROE, ROI NPM to DPR company, writer do statistical analysis done by using descriptive analysis, doubled linear regression, correlation coefficient and coefficient of determination. While testing the hypothesis using F test for simultaneous test and t test partially, using SPSS 16. Based on the results of data processing, obtained regression equation Y = 31.225 + 1.209 X₁ - 0.106 X₂ + 0.505 X₃ - 0.708 X₄ + ε, analysis results Statistics simultaneously obtained the value of determination coefficient of 28.3%. While the rest equal to 71.7% influenced by other factors. Based on hypothesis test by using significant level α = 0,05 result of F test, show that together regression model can be used to explain the relation between Return on Asset, Return On Equity, Return On Investment and Net Profit Margin to Dividend Payout Ratio. Keywords: Return on Assets, Return on Equity, Return On Investment and Net Profit Margin, Dividend Payout Ratio

scholarly journals Pengaruh Return On Assets, Return On Equity, Debt To Equity Ratio, Inflasi, Dan Suku Bunga Terhadap Return Saham Pada Perusahaan Manufaktur Di Bursa Efek Indonesia (Studi Empiris Pada Perusahaan Secondary Sectors Periode 2010-2015)

2018 ◽  
Vol 6 (1) ◽  
pp. 063-076
Author(s):  
Ningsih Hikmawati ◽  
Adi Wiratno ◽  
Suyanto . ◽  
Darmansyah .
Keyword(s):  
Interest Rate ◽  
Stock Returns ◽  
Stock Return ◽  
Quantitative Methods ◽  
Stock Exchange ◽  
Secondary Data ◽  
Manufacturing Companies ◽  
Return On Assets ◽  
Return On Equity ◽  
Equity Ratio

This study is aimed to ascertain and analyse the influence of return on assets, return on equity, debt to equit ratio, inflation, and interest rate, both partiall and simultaneously on the stock returns in manufacturing companies of secondary sectors listed in the Indonesian Stock Exchange. This research uses quantitative methods and EVIEWS panel 8 to analyse the regression. The population are manufacturing companies of secondary sector listed in the Indonesian Stock Exchange consisted of basic and chemical sectors, miscellaneous industry, and consumer goods sector in the period of 2010-2015. The sampling method used is pusposive sampling with the final number of 40 companies. The research required secondary data. The results show that return on assets has no negative effect on stock return, mean while, return on equity and interest rate have positive effect on stock return. Return on assets, return on equity, debt to equity ratio, inflation and interest rate all simultaneously have effect on stock returns.

scholarly journals Impact of Credit Risk on the Profitability of Selected Commercial Banks Listed on the National Stock Exchange

2021 ◽  
Vol 1 (3) ◽  
pp. 1-15
Author(s):  
Sitaram Pandey ◽  
Amitava Samanta
Keyword(s):  
Credit Risk ◽  
Significant Relationship ◽  
Commercial Banks ◽  
Stock Exchange ◽  
Capital Adequacy ◽  
Series Data ◽  
Return On Assets ◽  
Return On Equity ◽  
Capital Adequacy Ratio ◽  
Indian Banks

This research is focusing on evaluation of the impact of credit risk on the profitability of selected commercial banks listed on National Stock Exchange. The financial ratios are taken as a proxy to evaluate credit risk and bank’s profitability. Profitability was measured through Return on Equity and Return on Assets whereas credit risk was measured by Pre-Provision Profit to Total Loans and Advances, Loan to Asset Ratio, Capital Adequacy Ratio, Credit to Deposit Ratio and Advances over Loan Funds. Based on the financial information of 2009 to 2017, the study concludes that Credit risk, as calculated from Pre-Provision Profit to Total Loans and Advances, Loan to Asset Ratio, Capital Adequacy Ratio, Credit to Deposit Ratio and Advances over Loan Funds have a non-significant relationship with profitability measured by Return on Assets whereas there is significant relationship exist only between Advances over Loan Funds and profitability measured by Return on Equity. The regression model of ROE shows the model is significant as compared to ROA model. The present study employed Auto Correlation and Durbin-Watson statistics, Unit root test & Multi-Collinearity tests to measure the robustness of time series data. Also the results of the regression analysis show that there exist a negative correlation between credit upon deposit ratio and return on equity. As per the current study, the Indian banks has to keep check on advances upon total funds ratio, as it was found most significant factor impacting the profitability of Indian banks.

scholarly journals Protectionism within disclosure regulation: evidence from national transparency and GAAP choices

2009 ◽  
Vol 6 (4) ◽  
pp. 234-242
Author(s):  
Patrice Gélinas ◽  
Lisa Baillargeon
Keyword(s):  
Financial Reporting ◽  
Empirical Support ◽  
Accounting Standards ◽  
Cross Sectional ◽  
Disclosure Regulation ◽  
Scarce Resources ◽  
Financial Reporting Standards ◽  
National Welfare ◽  
Sectional Analysis ◽  
And Control

The arguments used thus far in the literature to justify disclosure regulation are that it increases global economic efficiency and that it redistributes wealth among investors. In this paper, we depart from this view and propose that disclosure regulation may also be used by national authorities as a protectionist mechanism to indirectly charge for access to national scarce resources and thereby extract economic rents from resources-needy entities. This increases national welfare, but is inefficient globally. We find empirical support for our proposition through a cross-sectional analysis of financial reporting standards of 62 countries. Results suggest that national objectives in implementing disclosure regulation represent a major obstacle for the global convergence of accounting standards and that disclosure regulation’s purpose may not be limited to solving the separation of ownership and control dilemma.

scholarly journals CSR EFFECT ON MARKET AND FINANCIAL PERFORMANCE

El Dinar ◽  
2014 ◽  
Vol 1 (02) ◽  
Author(s):  
Dian Masita Dewi
Keyword(s):  
Financial Performance ◽  
Direct Effect ◽  
Research Result ◽  
Value Added ◽  
Market Value ◽  
Return On Assets ◽  
Return On Equity ◽  
Market Value Added ◽  
Positive Effect ◽  
Significant Direct Effect

<p>This study aims to predict causality model [33] effect of Corporate Social Responsibility on financial performance. This study also examines motivation of CSR implementation based on financial performance and market performance in non-financial public companies and banks that disclose CSR activities and listed at Indonesia Stock Exchange during 2007–2009. Numbers of samples were 46 companies. Data was analyzed by GSCA. Research result showed that there was a significant direct effect between CSR on Return on Assets (ROA), Return on Equity (ROE). In contrast, there was no significant direct effect between CSR on Market Value Added (MVA). In addition, there was a significant direct effect between Return on Assets (ROA) on CSR, Return on Equity (ROE) on CSR and there was no significant direct effect between Market Value Added (MVA) on CSR. There were three empirical findings novelties of this study. First, return on assets (ROA) has positive effect on CSR and otherwise CSR has positive effect on ROA. Second, ROE has positive effect on CSR and otherwise CSR has positive effect on ROE. Last, MVA affect on CSR and otherwise CSR affect on MVA.</p> <p> </p>

scholarly journals Pengaruh Return On Asset (ROA), Return On Equity (ROE), Current Ratio (CR) terhadap Harga Saham pada Perusahaan yang Terdaftar Di Bursa Efek Indonesia Periode 2015-2018

2020 ◽  
Vol 4 (2) ◽  
pp. 426
Author(s):  
Teresia Sri Arihta ◽  
Dhea Cristina Damanik ◽  
Susi Hannaria Manalu ◽  
Rafida Khairani
Keyword(s):  
Stock Prices ◽  
Secondary Data ◽  
Major Influence ◽  
Linear Regression Method ◽  
Manufacturing Companies ◽  
Return On Assets ◽  
Current Ratio ◽  
Significance Level ◽  
Return On Equity ◽  
Trade And Investment

This study aims to determine and examine the influence of the variable Return On Assets, Return On Equity, and Current Ratio on Stock Prices simultaneously or partially, and also to see what variables have a very big influence on the stock prices of wholesale companies in the Trade sector. and Investment. The data processed is secondary data in the form of a summary of the financial statements of 15 manufacturing companies in the Wholesale sector of the Trade and Investment sector from 2015 to 2018. The method used in conducting this research is the classical assumption test and multiple linear regression method using SPSS version 20.00. The test hypothesis used in this study is t-statistic and F-statistic at the 5% significance level. Testing that is sourced from the simultaneous regression coefficient test means that the Return on Assets, Return On Equity, and Current Ratio simultaneously can have a major influence on stock prices. Meanwhile, partially it can be interpreted that there is a significant influence between Return On Assets on stock prices in wholesale manufacturing companies in the Trade and Investment sector. And does not have a partial effect between Return On Equity and Current Ratio on stock prices in wholesale manufacturing companies in the Trade and Investment sector. 

scholarly journals PENGARUH INTELLECTUAL CAPITAL TERHADAP KINERJA KEUANGAN PERUSAHAAN PUBLIK DI INDONESIA (Studi Empiris Pada Perusahaan Manufaktur di BEI 2012-2014)

2017 ◽  
Vol 2 (1) ◽  
Author(s):  
Dianing Ratna Wijayani
Keyword(s):  
Intellectual Capital ◽  
Stock Exchange ◽  
Linear Regression Analysis ◽  
Total Sample ◽  
Multiple Linear Regression Analysis ◽  
Significant Positive Effect ◽  
Manufacturing Companies ◽  
Return On Assets ◽  
Return On Equity ◽  
Positive Effect

The purpose of this research was to examine the effect of intellectual capital on Return On Assets, Earning Per Share and Return On Equity. The population of this research is manufacturing companies listed on the Stock Exchange the period 20122014, a total sample of companies amounted to 51 samples were taken by using purposive sampling method. The method of analysis in this research is multiple linear regression analysis. The results of this study indicate that intellectual capital significant positive effect on ROA. This condition occurs because if the human resource capacity the better, it is expected to produce profitability Return on Assets increased. Intellectual capital is significant positive effect on EPS. This condition occurs because when intellectual capital is getting better, the public trust in the company, the better, so that the products or services offered by the company is accepted by the community and increasing revenue. Intellectual capital is significant positive effect on ROE. This condition occurs because the intellectual capital increases, the company has been using its capital more effectively to improve human resources, so that the performance of employees to generate increasing profits. Keyword : Intellectual Capital, Financial Performance, Return on Assets, Earning Per Share and Return On Equity

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