scholarly journals Cash flows, capital structure and shareholder value: Empirical evidence from Amman stock exchange

Accounting ◽  
2021 ◽  
pp. 513-524 ◽  
Author(s):  
Fawzi A. Al Sawalqa
Keyword(s):  
Capital Structure ◽  
Significant Relationship ◽  
Stock Exchange ◽  
Shareholder Value ◽  
Fixed Effect Model ◽  
Cash Flows ◽  
Insurance Companies ◽  
Investment Projects ◽  
Effect Model ◽  
Amman Stock Exchange

The current study links the information contents of the three main financial statements in a balanced panel data model to empirically examine the effect of cash flows per share and capital structure on shareholder value. The results of the study are based on a sample of 270 firm-year observations from the Jordanian commercial banks and insurance companies that listed on Amman Stock Exchange (ASE) from 2011 to 2019. Based on the Fixed Effect Model (FEM) with Driscoll-Kraay standard errors, the empirical results show that cash flows from operating activities per share had a positive and significant relationship with shareholder value, whereas both the cash flows from investing and financing activities per share had negative but insignificant relationship with shareholders’ value. Results also show that capital structure had a negative but insignificant relationship with shareholder value. Finally, the results indicate that dividend per share had a positive and significant relationship with shareholder value. Accordingly, decision-makers should direct cash to efficient investment projects in order for cash outflows from investing activities to create value to shareholders and to generate positive cash flows from financing activities. Similarly, an appropriate capital structure should be selected to create value for shareholders.

scholarly journals Effects of Capital Structure on Financial Performance of Insurance Companies in Nepal

2020 ◽  
Vol 10 (3) ◽  
pp. 35
Author(s):  
Bishnu Prasad Bhattarai
Keyword(s):  
Capital Structure ◽  
Financial Performance ◽  
Annual Report ◽  
Random Effect ◽  
Random Effect Model ◽  
Fixed Effect Model ◽  
Insurance Companies ◽  
Return On Assets ◽  
Total Debt ◽  
Effect Model

The study has examined the effects of capital structure on financial performance of insurance companies in Nepal. Data were collected from the annual report of the respective insurance companies' web site. The panel data of 14 Nepalese insurance companies from 2007/08 to 2015/16, leading to a total of 126 observations. The data were analyzed using pooled OLS model, random effect model and fixed effect model. The study has been return on assets as dependent variable whereas total debt ratio, equity to total assets, leverage, firm size, liquidity ratio and assets tangibility are independent variables. The result concluded that equity to total assets, leverage, and assets tangibility have effects the financial performance in Nepalese insurance companies' cases.

scholarly journals The Relationship Between Cash Flow and Profitability of Insurance Companies listed in Amman Stock Exchange in Jordan

2019 ◽  
pp. 51-60
Keyword(s):  
Stock Exchange ◽  
Cash Flows ◽  
Regression Method ◽  
Annual Reports ◽  
Insurance Companies ◽  
Earnings Per Share ◽  
Amman Stock Exchange ◽  
Main Factors ◽  
The Relationship ◽  
Operating Activities

The aim of the paper is to investigate the relationship between the main factors of Cash Flows (Operating activities, investing activities, and Financing activities) and the profitability measured by Earnings per Share (EPS). The sample included five insurance companies listed in Amman stock exchange (ASE) during the period (2011-2015). To achieve the goal of the paper, and to analyze the data extracted from the annual reports, the paper used simple and multiple liner regression method. The results of the paper revealed that there is a significant impact of element of Cash Flows (Operating activities, investing activities, and Financing activities) on Profitability measured by (EPS).

Impact of Institutional Ownership on Stock Liquidity: Evidence from Karachi Stock Exchange, Pakistan

2018 ◽  
Vol 19 (4) ◽  
pp. 939-951 ◽  
Author(s):  
Muhammad Sadil Ali ◽  
Shujahat Haider Hashmi
Keyword(s):  
Stock Exchange ◽  
Institutional Ownership ◽  
Fixed Effect Model ◽  
Insurance Companies ◽  
Positive Role ◽  
Stock Liquidity ◽  
Listed Firms ◽  
Effect Model ◽  
Efficient Resource ◽  
The Impact

This study empirically investigates the impact of institutional ownership on stock liquidity; we used a sample size of 84 non-financial companies listed on Karachi Stock Exchange (KSE). Data were gathered for the period of 10 years, starting from 2005 to 2014. This study employs turnover ratio to measure stock liquidity while institutional ownership is measured by dividing number of shares kept by institutions from total number of outstanding shares. The fixed effect model shows that the degree of stock liquidity in Pakistani-listed firms tend to significantly increase for the firms where institutions hold a significant amount of share of that particular firm. This study also finds that ownership by bank and investment companies are positively associated with liquidity, while relationship between ownership by insurance companies and stock liquidity is found to be insignificant. Our evidence supports that many but not all institutional investors play a positive role to improve stock liquidity in Pakistani capital market. The results of this study are important for dealers, traders and brokers, in the sense that they can facilitate investors in efficient resource allocation.

scholarly journals AN EVALUATION OF THE IMPACT OF CAPITAL STRUCTURE ON FIRMS' PERFORMANCE : A QUANTITATIVE STUDY OF SELECTED NON-FINANCIAL FIRMS LISTED ON THE INDONESIA STOCK EXCHANGE DURING THE PERIOD 2005-2012

2018 ◽  
Vol 1 (1) ◽  
pp. 88-105
Author(s):  
Argeta Argeta ◽  
Niken S. Putri
Keyword(s):  
Capital Structure ◽  
Stock Exchange ◽  
Random Effect ◽  
Fixed Effect Model ◽  
Transportation Industry ◽  
Financial Firms ◽  
Financial Position ◽  
Industry Effect ◽  
Effect Model ◽  
The Impact

Capital structure is an important element for every company and directly affects the firms' performance and financial position. This study aims to evaluate the impact of capital structure on the performance of non-financial firms listed on the Indonesia Stock Exchange during the period 2005-2012. The data consist of 150 publicly listed non-financial firms from 8 non-financial industries in Indonesia. Panel data for the selected firms were generated and analyzed using both fixed effect model and random effect. The result shows that capital structure (DAR) has a significant impact on firms' performance (ROA, ROE, and GPM) and has no significant impact of capital structure on firms' performance caused by industry differences. Infrastructure, utilities, and transportation industry has the strongest industry effect on the impact of capital structure on firms' performance.

scholarly journals Are All Independent Directors the Same? Evidence from Italian Listed Companies

2018 ◽  
Vol 13 (9) ◽  
pp. 78
Author(s):  
Paolo Tenuta ◽  
Domenico Rocco Cambrea ◽  
Debora Fazzari
Keyword(s):  
Firm Performance ◽  
Significant Relationship ◽  
Stock Exchange ◽  
Listed Companies ◽  
Fixed Effect Model ◽  
Independent Directors ◽  
Listed Firms ◽  
Female Directors ◽  
Effect Model ◽  
The Impact

The purpose of this study is to investigate the impact of independent directors on the performance of Italian listed firms on the Milan Stock Exchange during the period 2006-2015. After applying a Fixed Effect Model, the empirical findings suggest that the composition of the board may affect corporate performances and, more specifically, a significant relationship emerges between the presence of independent directors within the Board and company results. Specifically, independent directors and independent female directors positively affect firm performance. Diversely, independent busy directors, those with hold more than three directorship in other boards, do not affect performance.

scholarly journals Analisis Faktor-faktor yang Memengaruhi Struktur Modal pada Perusahaan Sektor Pertanian yang Terdaftar di Bursa Efek Indonesia

2019 ◽  
Vol 9 (2) ◽  
pp. 102-114
Author(s):  
Irena Anggita ◽  
Rindah F Suryawati
Keyword(s):  
Capital Structure ◽  
Firm Size ◽  
Agricultural Sector ◽  
Stock Exchange ◽  
Sampling Technique ◽  
Fixed Effect Model ◽  
Purposive Sampling ◽  
Effect Model ◽  
Size Growth ◽  
The Capital Structure

This study aims to analyze the effect of profitability, firm size, growth, liquidity, and asset structure on capital structure of companies listed in the Agricultural Sector in Indonesia Stock Exchange for the period of 2012 to 2016. The sample in this study totals 14 companies, obtained through purposive sampling technique. This research used fixed effect model that was processed in Eviews program. This study found that the variable of growth, liquidity, asset structure  are known to have no effect on the capital structure of the company. Profitability and firm size are known to affect the capital structure where profitability affects negatively and firm size affects possitively.

scholarly journals FAKTOR-FAKTOR YANG MEMPENGARUHI STRUKTUR MODAL PADA SEKTOR PERKEBUNAN

Media Bisnis ◽  
2020 ◽  
Vol 11 (2) ◽  
pp. 123-134
Author(s):  
JULIANA YAPI ◽  
SATRIYO WIBOWO
Keyword(s):  
Capital Structure ◽  
Stock Exchange ◽  
Sampling Technique ◽  
Fixed Effect Model ◽  
Sales Growth ◽  
Business Risk ◽  
Effect Model ◽  
Panel Data Regression ◽  
Regression Techniques ◽  
The Capital Structure

The purpose of this research is to test and analyze empirically the influence of profitability, firm size, liquidity, business risk, sales growth, asset structure and growth asset to capital structure. This research data consists of financial statements of plantation sector companies in Indonesia that listed in Indonesia Stock Exchange period 2008-2016. Sampling technique is used purposive sampling with 8 companies that met the criteria and were analyzed using panel data regression techniques with fixed effect model by using software Eviews 9 to test the hyphotesis. The results of this research shows that profitability, size, liquidity, business risk, and asset structure influence the capital structure, while sales growth and growth asset do not influence the capital structure. Where overall this model is fit.

Do Financially Constrained Firms Earn Higher Returns than the Unconstrained Firms? A Comprehensive Evidence from Pakistan Stock Exchange

2020 ◽  
Keyword(s):  
Time Series ◽  
Asset Pricing ◽  
Capital Structure ◽  
Stock Returns ◽  
Financial Constraints ◽  
Stock Exchange ◽  
Cash Flows ◽  
Total Asset ◽  
Cash Holding ◽  
The Relationship

This paper examines the relationship between financial constraints and the stock returns explaining the pricing of stock through financially constrained and unconstrained firms in Pakistan. Three proxies; total assets, tangible to total assets and cash holding to total assets ratios) have been used for financial constraints and the study tried to investigate that either the investors are compensated for taking the extra risk or not in Pakistan Stock Exchange (PSX). We find that the financially constrained firms don’t earn higher returns when their capital structure is heavy with liquid assets and their cash flows are more than the unconstrained firms in PSX. Moreover, the time series results showed that the risk-adjusted returns of the most constrained firms give the mix and somewhat negative and significant and insignificant results for the Pakistani firms listed in PSX sorted based on tangible to total assets and Cash holding to total asset ratios. Keywords: Asset Pricing, Financial constraints, risk-adjusted performance of portfolios

scholarly journals Empirical Investigation of Symmetric and Asymmetric Target Adjustment Models: Capital Structure of Non-Financial Firms in Jordan

2017 ◽  
Vol 9 (3) ◽  
pp. 133 ◽  
Author(s):  
Bashar K. Abu Khalaf
Keyword(s):  
Capital Structure ◽  
Stock Exchange ◽  
Interaction Model ◽  
Firm Characteristics ◽  
Leverage Ratio ◽  
Financial Firms ◽  
Large Size ◽  
Amman Stock Exchange ◽  
Target Leverage ◽  
The Impact

The different capital structure theories propose the possible asymmetric behavior of capital structure. Thus, this paper empirically investigates whether non-financial Jordanian firms follow symmetrical or asymmetrical adjustment model. Then, an interaction model with the size and profitability (firm characteristics) investigated the impact of low/high profit and small/large size on the adjustment of leverage towards the target leverage ratio. This paper covered the period of 14 years (2002-2015) for a total of 110 companies listed on Amman Stock Exchange (75 industrial and 35 services). Results indicate that although Jordanian firms seek a target leverage ratio, their adjustment towards that target is Asymmetrical and high profitable and large companies tend to adjust faster than low profitable and small size companies.

scholarly journals Validity of Altman Z-Score Model to Predict Financial Failure: Evidence From Jordan

2018 ◽  
Vol 10 (8) ◽  
pp. 181 ◽  
Author(s):  
Sufian Al-Manaseer ◽  
Suleiman Al-Oshaibat
Keyword(s):  
Stock Exchange ◽  
Financial Statement ◽  
Insurance Companies ◽  
Z Score ◽  
Financial Reports ◽  
Financial Failure ◽  
Amman Stock Exchange ◽  
The Face ◽  
The Subject ◽  
Score Model

This paper aims to investigate the Validity of Altman z-score model to predict financial failure in insurance companies listed on Amman Stock Exchange (ASE) over the period 2011-2016. To achieve the goal of the study, the study depended on the different statistics analytical method and Multiple Linear Regression through doing the statistical analysis of the independent variables on the dependent variable related to the subject of the study through the (E-views) program in order to cover the analytical part of the study, in addition to the descriptive method through relying on books, periodicals, previous studies and financial reports of the insurance companies of the study’ sample, whether the direct or the indirect ones, to cover the theoretical part. The result of the study finds a high predictive power for Z-score model. Moreover, the findings reveal that Z-Score model could be valuable instrumental indicators for many users of financial statement such as financial managers, auditors, lenders, investors, to make right decisions in the face of financial failure.

Sign in / Sign up

Export Citation Format

Share Document