TITLE

The Value Relevance of Non-cash Net Working Capital of Listed Companies in Tehran Stock Exchange

AUTHOR(S)
Yancheshmeh, M. Azemi; Sabagh, M.
PUB. DATE
October 2013
SOURCE
Journal of Financial Accounting Research;2013, Vol. 5 Issue 17, preceding p6
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
Considering the elements of financial policy (strategy), such as company's financial leverage and amount of current working capital that company needs to do it's operations, helps managers for expansion of a particular financial program and to succeed and survive in today marketplace. This paper tries to survey value relevance of non-cash net working capital. This study is a fundamental experimental research and in nature is a correlation research. The type of regression model used in this study is a regression model with pooled data. To test the research hypotheses a sample of 118 listed companies in Tehran stock exchange, is selected by using systematic elimination method of sample selection, for a period of 2006-2010. The results of the research indicate that there is no negative relationship between the net working capital investment and firm's value. Moreover findings show extra investment in net working capital considering the current level of firm's net working capital have negative relationship with firm's value. Also, stockholders give an especial attention to the level of debt and capital structure of company in levered companies.
ACCESSION #
96737470

 

Related Articles

  • Efficiency of Working Capital Management and Corporate Profitability. Hyun-Han Shin; Soenen, Luc // Financial Practice & Education;Fall/Winter98, Vol. 8 Issue 2, p37 

    Efficient working capital management is an integral part of the overall corporate strategy to create shareholder value. We investigate the relation between the firm's net-trade cycle and its profitability. This relationship is examined using correlation and regression analysis, by industry and...

  • MARKET PREFERENCES FOR CHARACTERISTICS OF COMMON STOCKS. Benishay, Haskel // Economic Journal;Mar73, Vol. 83 Issue 329, p173 

    This study examines empirically the determinants of the rate of return on common stocks for ten cross-sections of 86 common stocks for the years 1958-1967 in a multiple regression analysis. Theoretically, the common stock rate of return under investigation, y, is defined as the ratio of the ...

  • Investing in the intermediary channel. Eve, Frank // Mortgage Strategy;12/19/2005, p43 

    The article comments on the state of the mortgage intermediary sector in Great Britain in 2006. There is a possibility that lenders will make a decision to invest more money in the intermediary channel because they have the capital to make key technological developments that can develop the...

  • The impact of working capital and financial structure on profitability of Islamic banking industry. Valahzaghard, Mohammad Khodaei; Taherinejhad, Ali // Management Science Letters;2012, Vol. 2 Issue 7, p2625 

    In this paper, we present an empirical survey on selected Iranian banks operating actively from 2005 to 2010. The proposed study considers the impacts of four important factors including degree of financial leverage, bank size, working capital and liquidity on return on asset as a primary source...

  • STUDY ABOUT THE INTERDEPENDENCE BETWEEN THE FINANCIAL POSITION AND PERFORMANCE WITHIN THE NATIONAL FOREST ADMINISTRATION - ROMSILVA SUBUNITS. Cristina, Beleţu Elena // Annals of the University of Craiova, Economic Sciences Series;2013, Vol. 1, p154 

    In order to elaborate the financial accounting diagnosis, one must evaluate the performance and the financial position, as well as the interdependence between them. In order to reflect the interdependence between financial position and performance an analysis was made using the multiple linear...

  • The Impact of Financial Leverage to Profitability Study of Companies Listed in Bucharest Stock Exchange. VINTILA, Georgeta; DUCA, Floriniţa // Ovidius University Annals, Series Economic Sciences;2012, Vol. 12 Issue 1, p1741 

    The present study examines the relationship between return on equity (ROE), leverage, size of firms and total assets turnover. A sample companies registered under Bucharest Stock Exchange were examined. The study employed regression method to estimate the impact of debt level on profitability...

  • A Multivariate Study of Firm Performance and the Use of Modern Analytical Tools and Financial Techniques. Moore, James S.; Reichert, Alan K. // Interfaces;May/Jun89, Vol. 19 Issue 3, p79 

    A survey of the Fortune 500 firms reveals that major domestic corporations are selective yet progressive adoptors of formal analytical procedures and hold positive perceptions regarding the role of microcomputers in the corporate decision-making process. We used logistic regression and multiple...

  • Levered Returns. GOMES, JOAO F.; SCHMID, LUKAS // Journal of Finance (John Wiley & Sons, Inc.);Apr2010, Vol. 65 Issue 2, p467 

    This paper revisits the theoretical relation between financial leverage and stock returns in a dynamic world where both corporate investment and financing decisions are endogenous. We find that the link between leverage and stock returns is more complex than static textbook examples suggest, and...

  • A study on relationship between working capital and profitability. Ghodrati, Hassan; Ghanbari, Jaber // Management Science Letters;2014, Vol. 4 Issue 8, p1675 

    This paper studies the relationship between working capital management and profitability of accepted corporations in Tehran Stock Exchange over the period 2008-2012. The study selected 66 firms as a statistical sample based on Cochran formula and simple random selection. In this study, variables...

Share

Read the Article

Courtesy of THE LIBRARY OF VIRGINIA

Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics