The Relationship Between Earnings and Its Components with Stock Returns Emphasizing on Earnings Quality of Listed Firms in Tehran Stock Exchange (TSE). PDF Download
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Author: Reza Janjani
Publisher:
ISBN:
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Languages : en
Pages : 22
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Book Description
This paper examines the relationship between earnings and its components with stock returns emphasizing on the earnings quality of listed firms in Tehran Stock Exchange (TSE). In order to do this, a sample of 230 listed firms in Tehran Stock Exchange was selected over a seven-year period (2003 to 2010). The results of Panel data method showed that earnings components involved information content, but cash component of earnings included more information content than accrual one. Also, this paper indicated that information content of earnings was greater than the information content of cash flow. However, when earnings were of higher quality, no significant difference found between them in terms of information content. Also, it was found that information content and cash flow in high earnings quality firms were more than firms which had low earnings quality. The results also showed that firms with high earnings quality had high returns and firms with low earnings quality had negative returns as the firms that had the highest earnings quality could deliver 17% more returns compared to the firms produced the lowest rate of earnings quality within the period under study.
Author: Reza Janjani
Publisher:
ISBN:
Category :
Languages : en
Pages : 22
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Book Description
This paper examines the relationship between earnings and its components with stock returns emphasizing on the earnings quality of listed firms in Tehran Stock Exchange (TSE). In order to do this, a sample of 230 listed firms in Tehran Stock Exchange was selected over a seven-year period (2003 to 2010). The results of Panel data method showed that earnings components involved information content, but cash component of earnings included more information content than accrual one. Also, this paper indicated that information content of earnings was greater than the information content of cash flow. However, when earnings were of higher quality, no significant difference found between them in terms of information content. Also, it was found that information content and cash flow in high earnings quality firms were more than firms which had low earnings quality. The results also showed that firms with high earnings quality had high returns and firms with low earnings quality had negative returns as the firms that had the highest earnings quality could deliver 17% more returns compared to the firms produced the lowest rate of earnings quality within the period under study.
Author: Hassan Mehre Niya Sibani
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ISBN:
Category :
Languages : en
Pages : 13
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Book Description
One of the main factors in making fundamental changes in Iran's economic environment can be the generalization of ownership of enterprises, financing through public participation and the privatization of government sectors and enterprises. In this context, the transparency and optimal quality of financial information, which is the basis of the optimal economic decisions of investors, creditors and, in general, users of information, is of particular importance. We aimed to investigate the fundamental effect of real profits management on stock returns with an emphasis on the quality of audit auditing with 16 underlying hypotheses and using the information of 123 companies admitted to Tehran Stock Exchange during the years 2011-2015. The results showed a significant relationship between earnings management and stock returns. On the other hand, research showed that the entry of audit quality variables led to re-approval of the model.
Author: Rezvan Hejazi
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Category :
Languages : en
Pages :
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Book Description
This study investigated the effects of income smoothing and earnings quality on evaluating the performance of companies listed on the Tehran Stock Exchange. To do this research, we studied 96 companies among those listed within the years from 1999 to 2003. The data related to the performance mean of companies during the five-year period were aggregately and yearly studied, collected, and tested. The results of the study indicated that their performance is not influenced by income smoothing or earnings quality. In other words, no significant difference was found between the performance mean of smoother and no smoother companies and between those having high earnings quality and those having low earnings quality.
Author: Hamid Jamshidi
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ISBN:
Category :
Languages : en
Pages : 16
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Book Description
The results of several experimental studies, the notion that the most important source of income deemed to decision makers rely more profit than any other criteria, has been proved, however, it should be noted that as the main source of income, it may not reflect the actual performance of companies and their management, because of the inherent flexibility of accounting standards, the interpretation and application of accounting methods in many cases, the judgments and actions of managers, therefore, the quantity of interest should be given to quality. The main purpose of research, quality of accruals and free cash flows, and that when companies have excess cash how is the quality of accruals? In this study, to assess the quality and relevance of accruals and free cash flows are attempting to assess the impact of listed companies from 2008 to 2011 in the Tehran Stock Exchange. Correlation test was used for data analysis spss software. Survey results indicate that there is a significant relationship between the quality of accruals and free cash flows. The results of this study suggested that the directors must have regard to the flow of economic benefits to the financial reporting within the company and the optimal use of resources.
Author: Mohammad Reza Karimi Torghabeha
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Category :
Languages : en
Pages : 8
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Book Description
One of the primary economic issues is associated with optimum resource allocation in profitable investments with reasonable risk. For this purpose, performance measurement's criteria are needed some of which emphasize cash flow variables and some others focus on information content of accounting profit. On this basis, this study examines the relationship between earnings before tax and interest and operational cash flows with stockholders' return in Tehran Stock Exchange (TSE). In this regard, information asymmetry was also examined. To test hypotheses, multivariable regression and combined data method were used. The results showed that based on the information of 102 companies in stock market from 2004 to 2009, there was a positive and significant correlation between earnings before interest and tax and stock return in the companies. While, operational cash flow has no significant impact on stock return. Increasing information asymmetry, earnings before interest and tax has a positive and significant correlation with stockholders 'return; but operational cash flow has no significant effect on stockholders' return. In other words, earnings before interest and tax have higher information content than operational cash flow.
Author: Esmaeil Amiri
Publisher:
ISBN:
Category :
Languages : en
Pages : 9
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Book Description
Author: Mehri Akhavi Babi
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Category :
Languages : en
Pages : 15
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Book Description
This study was conducted to investigate the effects of financial risks on the relationship between earnings per share and stock returns. The statistical population of the study consisted of the companies accepted by Tehran Stock Exchange. According to the conditions for sampling, 65 companies were selected during a period of six years from 2008 to 2013 (i.e., 390 fiscal years), and four hypotheses were set forth to achieve the purposes of the study. The first hypothesis tried to assess the relationship between earnings per share and stock returns. The second, third, and fourth hypotheses investigated the significance of the effects of three financial risks, namely liquidity, credit, and solvency risks on the relationship between earnings per share and stock returns. The hypotheses of the study were tested using linear and multiple regressions. The findings of the study indicated that there was a positive and significant relationship between earnings per share and stock returns. In addition, the results proved that the credit and solvency risks had negative and significant effects on the relationship between earnings per share and stock returns, but the effect of liquidity risk on this relationship was not significant.
Author: Mashaallah Salari
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Languages : en
Pages : 13
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Book Description
Earnings forecast by management, investors and other entities are the main sources of information are considered. The significance of this variation depends on the forecast. This deviation is much lower, the prediction is more accurate On the other hand, and there are various sources for predictions. Among their predictions by managers. Therefore of this study was to investigate the accuracy of earnings forecast by managers to examine how directors of respond to specific features of structure property looks to reach this purpose the data of listed companies in Tehran Stock Exchange during the period 1386 to 1391, extracting 498 views using multiple regression data using statistical software E. Views 7were analyzed. The results showed a direct relationship between the independent variables of an institutional shareholder, directors of non-duty, responsibility separation of Managing Director and chairman of the board and the dependent variable is the earnings forecast accuracy the results showed that the variables percent majority ownership percentage ownership concentration and profit forecasts are variable.
Author: Hossein Eghbali
Publisher:
ISBN:
Category :
Languages : en
Pages : 14
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Book Description
The present study was conducted to provide evidence to clarify the relationship between earnings quality and stock liquidity as well as assess the impact of earnings quality on stock liquidity. In this study, 96 companies listed in Tehran Stock Exchange during the 5-year period of 2011-201 as statistical population were surveyed. The independent variable in this study is earnings quality, which is measured by two indices (accruals quality and earnings smoothing). Stock Liquidity Measurement Two liquidity variables that are dependent variables are used: liquid float percentage, number of trading days, and control variable. Combined regression model and data were used to test the hypotheses. The results of sub tests showed that the accruals quality was inversely and significantly correlated with the percentage of free float stocks and the number of trading days; however, the results showed that profit smoothing was inversely and significantly correlated. It has a number of trading days, unless sufficient evidence is found to show a significant relationship between earnings smoothing and the percentage of free float stocks.
Author: Mohamed Samy Eldeeb
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Category :
Languages : en
Pages :
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Book Description
The purpose of the paper is to measure impact of three determinants on the firm performance using the earnings quality as an intermediary variable. The three determinants measured in this research are firm specific return volatility, earnings management, and the corporate governance. The research is applied in the Egyptian stock exchange market, using the constituents of its most active index that is the EGX30 during the time frame 2010-2017. The data have been analyzed by using statistical techniques, like the Jarque-Bera Test, Pearson correlation, and structure equation modeling. The results of the statistical analysis approved the research hypotheses by proving the association among firms' specific return volatility, earnings management, corporate governance, on firms' stock performance in the Egyptian stock exchange market, using the earning quality as an intermediary variable.
