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Chughtai, Asma Rafique
- Determining the Impact of Dividends, Earnings, Invested Capital and Retained Earnings on Stock Prices in Pakistan: An Empirical Study
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Authors
Affiliations
1 Department of Management Sciences, Virtual University of Pakistan, PK
2 University of Lahore - School of Accountancy and Finance, PK
1 Department of Management Sciences, Virtual University of Pakistan, PK
2 University of Lahore - School of Accountancy and Finance, PK
Source
International Journal of Financial Management, Vol 4, No 1 (2014), Pagination: 74-81Abstract
Investment in capital market is always subject to high volatility and consequently evaded by risk averse investors. An analysis of the key factors behind variation in stock prices can motivate investors to inject their money into the capital market and invest in shares of listed companies. Ample researches have been conducted to explore the determinants of stock prices comprising company’s specific as well as macroeconomic factors. However, this study is focused on excogitating the relationship between selected companies’specific factors and stock prices of companies listed on Karachi Stock Exchange of Pakistan. These include dividend per share, earning per share, capital employed and retained earnings. Estimated Generalized Least Square (EGLS) has been used for analysis of data based on a sample of 99 listed companies for a period of six years from 2006 to 2011. Findings indicate that dividend per share and earning per share Possess positive and significant relationship with market prices,meaning by an increase in these variables tends to increase stock prices. These findings are consistent with those of the previous researches. However, capital employed and retained earnings are found to have statistically insignificant relationship with stock prices. It may be due to collection of data from different sectors and limited number of data observations for the study. This study captures descriptive analysis as well as panel regression for better and in-depth analysis of selected fundamental variables on stock prices and led us to the conclusion that companies should focus on earnings per share and dividend per share to get desired financing and for well-being of economy.Keywords
Estimated Generalized Least Square (EGLS), Company’s Specific Factors, Stock Prices, Capital Market
- Relationship between Code of Corporate Governance and Corporate Financial Performance (An Empirical Study of Food Companies Listed on KSE)
Abstract Views :226 |
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Authors
Affiliations
1 Department of Management Sciences, Virtual University of Pakistan, Lahore, PK
1 Department of Management Sciences, Virtual University of Pakistan, Lahore, PK
Source
International Journal of Financial Management, Vol 7, No 1 (2017), Pagination: 1-9Abstract
The crucial role that implementation of Code of Corporate Governance plays on protecting the rights of minorities, shareholders, local as well as foreign investors cannot be denied. Companies all over the world are required to implement their respective Code of Corporate Governance for avoiding agency conflicts between companies' management and stakeholders and for assuring transparency in accountability. This paper aims at exploring the impact of implementation of corporate governance practices (designed by Securities and Exchange Commission of Pakistan) have on the financial position of companies. For explanatory variables of the study, composition of the board as per the Code of Corporate Governance that comprises of presence of independent, executive and non-executive directors has been taken into consideration. Return on equity has been taken as an indicator of firms' profitability i.e. the dependent variable. For this study, companies listed on food producing sector of Karachi Stock Exchange have been screened for excogitation of the relationship. It is an empirical research based on nine years data from 2007-2015. Using Hausman Test for selecting the data analysis technique between Fixed or Random, Fixed Cross Sectional Panel Analysis has been used for analysis of the data collected. Findings indicate that presence of independent, executive and non-executive directors as per the code requirements levies a significant impact on the profitability of companies indicated by return on equity. It is, thus concluded that companies should ensure compliance with code of governance practices to reduce not only the agency issues but also to increase their profitability.Keywords
Code of Corporate Governance, Fixed Cross Sectional Panel Analysis, Board Composition, Food Producers & Firms’ Profitability.References
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