The impact of firm specific factors on the stock prices: Empirical evidence from Belgrade stock exchange

Resumo O rating de crédito expressa uma opinião, por intermédio de escalas, sobre a qualidade do crédito de empresas, utilizado-a como medida de avaliação de risco no mercado. Agências de classificação de risco de crédito, como a Moody’s, divulgam os ratings que atribuem às empresas. Primeiramente, essas agências emitem o new rating, que representa o primeiro rating da companhia, e, posteriormente, essa emissão pode apresentar variações, denominadas upgrades e downgrades, relativas a boas e más notícias, respectivamente. Além disso, os ratings podem ser colocados em uma Watchlist quando, em breve, pode haver uma mudança do rating para downgrade ou para upgrade. O objetivo com este estudo consistiu, diante do que foi tratado, em abordar o impacto do rating de crédito sobre os preços das ações de empresas listadas na bolsa de valores brasileira. Para alcançar o objetivo proposto, foi analisada uma amostra de 44 empresas comercializadas na BM&FBovespa e 65 ratings nacionais de longo prazo emitidos pela Moody’s entre 2000 e 2015. Utilizou-se a metodologia de estudo de eventos, com os retornos normais calculados pelo modelo de retornos ajustados ao risco e ao mercado, e o Teste-F e o Teste-T para verificar a significância dos resultados. As análises finais evidenciaram que os preços das ações não são afetados de forma significativa pelas divulgações dos new ratings, downgrades, upgrades, on watch – possible downgrades e on watch – possible upgrades em nenhuma janela do evento, indicando que os ratings, para a amostra analisada, não trazem novas informações ao mercado.Palavras-chave: Ações. Rating. Estudo de eventos. Retornos anormais. Abstract Credit ratings are used as a mean to investors get new information on the companies by reducing the information asymmetry in the market. Thus, the rating is an important mean of business information with investors, enabling share prices relating to companies react to it. Branches of credit rating as Moody's, disclose the ratings they assign to companies. First, the agency issues the new rating, which represents the company's first rating, then this issue may vary, upgrades and downgrades calls relating to good and bad news respectively. In addition, the ratings could be placed in a Watchlist when, soon there may be a change to the rating downgrade or upgrade. The purpose of this study was to discuss the impact that the credit rating has on stock prices of companies listed on the Brazilian stock exchange. For a sample of 44 companies traded on BM&FBovespa and 65 long-term national ratings issued by Moody's between 2000 and 2015, we used the event study methodology, with normal returns calculated by the model of returns adjusted for risk and market the F-Test and T-Test to test the significance of the results. The final analysis showed that stock prices are not significantly affected by the disclosures of new ratings, downgrades, upgrades, on watch – possible downgrades and on watch – possible upgrades in any event window, indicating that the ratings do not bring new information to the market.Keywords: Stocks. Rating. Event studies. Abnormal returns.

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The Impact of Acquisition on Stock Value in Case of Warsaw Stock Exchange

Economics and Culture ◽

10.2478/jec-2019-0008 ◽

2019 ◽

Vol 16 (1) ◽

pp. 70-79

Author(s):

Wojciech Kaczmarczyk

Keyword(s):

Stock Prices ◽

Information Transfer ◽

Banking Sector ◽

Stock Exchange ◽

Public Information ◽

Electronic System ◽

Market Reactions ◽

Warsaw Stock Exchange ◽

Market Indexes ◽

The Impact

Abstract Research purpose: Seven of 10 companies that have won the Polish Forbes edition Merge & Acquisition 2018 Ranking are listed on Warsaw Stock Exchange. The aim of the conducted research was to test if the biggest acquisitions have an impact on stocks value and is it possible for typical investor to create extra profit by using knowledge of acquisition based on public information. Design/Methodology/Approach: Using data from Warsaw Stock Exchange (quotations), typical measures such as rate of return, standard deviation (risk), correlation and transaction volume changes were calculated. Each of the case results obtained for the company was compared with the result for stock market indexes: WIG (Warszawski Indeks Giełdowy – main WSE index), WIG20 (WSE sub-index of the 20 largest companies), mWIG40 (WSE sub-index of 40 medium companies) and sWIG80 (WSE sub-index of 80 small companies). In addition, the outcomes were confronted with public news (from WSE Electronic System for Information Transfer). Findings: Conducted research has shown that generally successful finalisation of acquisition results in changes of stock prices behaviour. Unfortunately, observed reactions were not the same. Acquisitions induced both increases and decreases in stock prices; there was also no rule in case of risk change. Generally, acquisitions and merges had rather good influence in banking sector (which is still concentrating), but there was no common reaction in other sectors. Originality/Value/Practical Implications: The results will be useful for investors acting on Warsaw Stock Exchange, especially for individual investor who are not able to carry out detailed analyses. The research provides results including possible pre-effects and after-effects of making big acquisition by a large company. The negative market reactions were also shown.

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Fair Value Accounting and Earnings Management Using LLP and Realized Gains and Losses: Study in Banking Industry Listed on Indonesia Stock Exchange

Jurnal Economia ◽

10.21831/economia.v14i2.19560 ◽

2018 ◽

Vol 14 (2) ◽

pp. 126-137

Author(s):

Ice Maria Ulfa ◽

Bambang Subroto ◽

Zaki Baridwan

Keyword(s):

Earnings Management ◽

Empirical Evidence ◽

Banking Industry ◽

Stock Exchange ◽

Fair Value ◽

Fair Value Accounting ◽

Loan Loss ◽

Trade Off ◽

Gains And Losses ◽

The Impact

Abstract: Fair Value Accounting and Earnings Management Using LLP and Realized Gains and Losses: Study in Banking Industry Listed on Indonesia Stock Exchange. This study examines whether earnings management can be limited by the implementation of fair value accounting in banking industry. The main contribution of this study is providing provide empirical evidence about the impact of fair value accounting on earnings management in Indonesia. Earnings management is proxied by loan loss provision (LLP), the realized of gains and losses, and the trade-off between realized gains and losses and LLP following Bratten et al (2013). The study provides empirical evidence that earnings management is still performed by banks, by using LLP, realized gains and losses and also occurs trade-off between LLP and realized gains and losses as means to perform earnings management in accordance with the needs of management. If banks are exposed to fair value accounting, managers will have more flexibility in reporting banks’ financial performance to present a desired earning, by providing them with additional earning managements tools. These findings can be informative for policymakers, banking practitioners, and academics. Keywords: earnings management, fair value accounting, LLP, realized gains and losses, trade-off LLP and realized gains and losses.Abstrak: Akuntansi Nilai Wajar dan Manajemen Laba menggunakan CKPN dan Realized Gains and Losses: Studi pada Industri Perbankan yang terdaftar di Bursa Efek Indonesia. Studi ini bertujuan untuk meneliti apakah manajemen laba dapat dibatasi oleh penerapan akuntansi nilai wajar dalam industri perbankan. Kontribusi dari penelitian ini adalah untuk memberikan bukti empiris tentang dampak penerapan akuntansi nilai wajar pada manajemen laba di Indonesia. Manajemen laba diproksikan oleh cadangan kerugian penurunan nilai (CKPN), realized of gains and losses, dan trade-off antara realized of gains and losses dan CKPN mengikuti model penelitian Bratten et al (2013). Studi ini memberikan bukti empiris bahwa manajemen laba masih dilakukan oleh bank menggunakan CKPN, realized of gains and losses dan juga terjadi trade-off antara CKPN dan realized of gains and losses sebagai sarana manajemen laba sesuai dengan kebutuhan manajemen. Konsekuensi dari paparan bank terhadap akuntansi nilai wajar dapat meningkatkan fleksibilitas manajer dalam melaporkan penghasilan yang diinginkan dengan memberikan mereka alat manajemen laba. Temuan-temuan tersebut dapat bersifat informatif bagi pembuat kebijakan, anggota industri perbankan, dan akademisi. Kata kunci: manajemen laba, akuntansi nilai wajar, CKPN, realized gains and losses, trade-off CKPN dan realized gains and losses.

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The Impact of Accounting Fundamentals and Macroeconomic Indicators on Manufacturing Companies' Stock Prices

Journal La Bisecoman ◽

10.37899/journallabisecoman.v2i3.404 ◽

2021 ◽

Vol 2 (3) ◽

pp. 22-29

Author(s):

Van hyung Shih ◽

Chien Hoang

Keyword(s):

Stock Prices ◽

Stock Exchange ◽

Secondary Data ◽

Manufacturing Companies ◽

Return On Equity ◽

Price Earnings Ratio ◽

Macroeconomic Indicators ◽

Beneficial Impact ◽

The Impact ◽

Stock Values

The aim of this research is to ascertain if accounting fundamentals and macroeconomic indicators have an effect on stock prices. In this research, a quantitative method was used. The population of this research includes manufacturing firms listed on the Stock Exchange, with a sample size of ten companies collected through secondary data during the 2019-2020 quarter. Scale of data measurement using a ratio scale. The findings indicated that inflation and interest rate macroeconomic variables had little impact on stock values. Fundamentals of Accounting The return on equity and the price-earnings ratio both have a substantial beneficial impact on company prices

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Causal Relation Between Stock Market Performance and Firm Investment in China: Mediating Role of Information Asymmetry

SAGE Open ◽

10.1177/2158244019885146 ◽

2019 ◽

Vol 9 (4) ◽

pp. 215824401988514

Author(s):

Ghulam Hussain Khan Zaigham ◽

Xiangning Wang ◽

Haji Suleman Ali

Keyword(s):

Information Asymmetry ◽

Stock Prices ◽

Stock Price ◽

Stock Exchange ◽

Causal Relation ◽

Negative Relationship ◽

Manufacturing Firms ◽

Price Performance ◽

Stock Market Performance ◽

The Impact

The main objectives of this study are to examine the impact of stock price performance on firm’s investment and to investigate the counter impact of changes in investment expenditures on stock price performance. The random effects model was applied on the panel data of Chinese manufacturing firms listed at the Shanghai Stock Exchange and the Shenzhen Stock Exchange during the period 2002 to 2016. The sample contains 398 firms with 5,970 observations. Although there is a statistically significant and negative relationship between stock price and investment expenditures, the impact of stock price on investment expenditures is far greater than that of investment expenditures on stock price. Information asymmetry positively mediates both investment sensitivity to stock prices and stock prices sensitivity to investment. This study is a valuable contribution toward the analysis of investment decision making by manufacturing firms in China. It also provides guidelines for investors to assess the informational status of the capital market before making investment decisions and to comprehensively understand the different decisions made by firms with regard to the issue of new stocks and the indirect information attached with such issues.

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Analysis of Institutional Factors Affecting Share Prices: The Case of National Stock Exchange

Global Business Review ◽

10.1177/0972150917713865 ◽

2018 ◽

Vol 19 (3) ◽

pp. 707-721 ◽

Cited By ~ 2

Author(s):

Neeraj Nautiyal ◽

P. C. Kavidayal

Keyword(s):

Stock Prices ◽

Stock Price ◽

Transition Period ◽

Stock Exchange ◽

Market Price ◽

Negative Relationship ◽

Value Added ◽

Price Variation ◽

Wide Range ◽

The Impact

This study offers empirical findings on the impact of institutional variables on firm’s stock market price performance. In order to identify the influence of companies financial on NIFTY 50 Index, our sample consists of balanced panel of 30 actively traded companies (that becomes the study’s index representative) over a massive transition period, 1995–2014. Attempts have been made with a wide range of econometric models and estimators, from the relatively straightforward to (static) more complex (dynamic panel analyses) to deal with the relevant econometric issues. Results indicate that increasing debt in capital structure does not establish any significant relation with the stock prices. Earnings per share (EPS) shows a poor explanation of price variation. Economic value added (EVA) indicates a positive relation with current as well as previous year’s stock price performances. However, dividend payout (DIVP) and dividend per share (DPS) achieve negative relationship at moderately significant level. The present study confirms that performance of companies fundamental ratios will be essential and immensely helpful to investors and analysts in assessing the better stocks that belong to different industry groups.

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Terrorism and Stock Market Linkages: An Empirical Study from a Front-line State

Global Business Review ◽

10.1177/0972150916668604 ◽

2017 ◽

Vol 18 (2) ◽

pp. 365-378 ◽

Cited By ~ 8

Author(s):

Imtiaz Arif ◽

Tahir Suleman

Keyword(s):

Stock Prices ◽

Stock Price ◽

Time Series Data ◽

Negative Impact ◽

Stock Exchange ◽

Series Data ◽

Front Line ◽

Long Run ◽

Factor Index ◽

The Impact

This article investigates the impact of prolonged terrorist activities on stock prices of different sectors listed in the Karachi Stock Exchange (KSE) by using the newly developed terrorism impact factor index with lingering effect (TIFL) and monthly time series data from 2002 (January) to 2011 (December). Johansen and Juselius (JJ) cointegration revealed a long-run relationship between terrorism and stock price. Normalized cointegration vectors are used to test the effect of terrorism on stock price. Results demonstrate a significantly mixed positive and negative impact of prolonged terrorism on stock prices of different sectors and show that the market has not become insensitive to the prolonged terrorist attacks.

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Post-Earnings Announcement Drift in Greece

Review of Pacific Basin Financial Markets and Policies ◽

10.1142/s0219091515500198 ◽

2015 ◽

Vol 18 (03) ◽

pp. 1550019 ◽

Cited By ~ 2

Author(s):

William Forbes ◽

George Giannopoulos

Keyword(s):

Financial Reporting ◽

Stock Prices ◽

Stock Exchange ◽

International Financial Reporting Standards ◽

Reporting Standards ◽

Earnings Announcement ◽

Financial Reporting Standards ◽

Post Earnings Announcement Drift ◽

Athens Stock Exchange ◽

The Impact

This paper presents evidence regarding the post-earnings announcement drift (PEAD) anomaly for the Greek market in the years 2000–2006 (covering earnings announcements in the years 2001–2007). The impact of the introduction of International Financial Reporting Standards on the size and prevalence of the PEAD anomaly is examined. Unlike recent evidence for the US market we find PEAD to be alive and well, and of growing importance in our Greek sample. It may be the adoption of international financial reporting standards (IFRS) has served to reduce earnings predictability in Greece and thus enhance PEAD in the Athens stock exchange (ASE) market. This contrasts strongly with US evidence that the post-earnings-announcement drift anomaly is now waning as more efficient markets and smarter, fundamentals-based, traders arbitrage its impact on stock prices.

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Analysis of the impact of the Work From Home Policy on Changes in Stock Prices and Transaction Volume Study of Telecommunications Companies at IDX

AKUNTABILITAS Jurnal Ilmiah Ilmu-Ilmu Ekonomi ◽

10.35457/akuntabilitas.v13i2.1281 ◽

2020 ◽

Vol 13 (2) ◽

pp. 30-38

Author(s):

Arie Setyo Dwi Purnomo

Keyword(s):

Stock Prices ◽

Stock Exchange ◽

Price Change ◽

Test Sample ◽

T Test ◽

Work From Home ◽

Sample Test ◽

The Impact ◽

Telecommunications Companies ◽

Paired T Test

The work from home policy due to the COVID 19 pandemic is an alternative in preventing the spread of the COVID 19 virus. The general public must get used to working and learning by utilizing telecommunications networks to support work. The increase in internet network traffic is expected to provide a stimulus for telecommunications companies. This study examines the sentiment of work from home to changes in price and transaction volume of shares of two companies, namely PT. Telkom Indonesia Tbk and PT. XL Axiata. Tbk. The analysis technique in this study uses quantitative analysis techniques with a paired t-test sample test. Data collected from the Indonesia Stock Exchange with the type of secondary data. Researchers used the paired t-test sample test using SPSS 21 software. The results showed that PT Telkom Indonesia Tbk indicated a significant price change of Rp. 343 before the policy but the volume of transactions increased after the announcement of the work from home policy. PT XL Axiata Tbk had a significant change of Rp. 126 which was higher before the work from home policy, but the transaction volume had no significant effect before and after the work from home policy.

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Disclosure of Corporate Social Responsibility (CSR) Through Company Characteristics at Company Listed on LQ45 Indonesia Stock Exchange (IDX)

International Journal of Economics Business and Accounting Research (IJEBAR) ◽

10.29040/ijebar.v1i02.275 ◽

2017 ◽

Vol 1 (02) ◽

Author(s):

Budiyono Budiyono ◽

Dewi Maryam

Keyword(s):

Corporate Social Responsibility ◽

Social Responsibility ◽

Firm Size ◽

Stock Prices ◽

Stock Exchange ◽

Social Orientation ◽

Public Ownership ◽

Corporate Social Responsibility Disclosure ◽

Corporate Social ◽

The Impact

In the era of globalization, environmental awareness has brought about changes in attitudes towards profit orientation of the social orientation of the company. Management as the agent cannot avoid the reality of the impact of corporate activity that not only generates profits / raise stock prices, but also has environmental impacts such as damage to ecosystems, pollution, and so forth. The purpose of this study was to analyze the influence of firm characteristics on corporate social responsibility disclosure in corporate annual reports in Indonesia. The populations in this study are 10 companies listed in the LQ45 index of the Indonesia Stock Exchange (IDX) with the research period of 2011 until 2015 and meet the criteria established. Analysis of the Data used is multiple linear regressions. The results of this study indicate that public ownership, liquidity, and firm size have no significant effect on corporate social responsibility disclosure. Meanwhile, leverage and profitability have a significant effect on corporate social responsibility disclosure. Keywords: corporate social responsibility disclosure, public ownership, leverage, liquidity, profitability, and firm size.

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