Search results

Introduction: Data of companies in the Informatics index between 2008 and 2017 fiscal years were analyzed. In the analysis, the following ratios were used as traditional performance evaluation criteria: Return on assets, return on equity, earnings per share, price to earnings ratio, market to book value ratio, and return on sales rate. In addition, economic value added (EVA) was also used. The companies in the Informatics index are divided into sub-sectors according to by field of activity. These sub-sectors are software, communication, and hardware marketing.

Aim: To analyze the power of traditional performance evaluation methods to explain the market value added (MVA).

Method: Regression analysis and autocorrelation tests were used as research methods. These were done with IBM SPSS Statistics 25.

Findings: Models and rates that explain the MVA with the most meaningful results were calculated. These models and ratios are as follows: For the software sub-sector, a market to book value ratio was 77.8%; for the hardware marketing sub-sector, earnings per share was 65.4%; for the communication sub-sector, a market to book value ratio was 92.5%. Market to book value was the independent variable that describes the best MVA value of the two sub-sectors.

Originality of the Study: In this study, the average of the values of all companies in the BIST Informatics Index is not taken. By dividing into sub-sectors, value deterioration from the sector difference is prevented. It is stronger in terms of statistical science.

Implications: Researchers can look for and model the relationship between traditional evaluation criteria and EVA or other value-based evaluation criteria in the same index or other indices.

In this paper, we study financial foundations of Austrian business cycle theory (ABCT). By doing this, we (1) clarify ambiguous and controversial concepts like roundaboutness and average period of production, (2) we show that the ABCT has strong financial foundations (consistent with its microeconomic foundations), and (3) we offer examples of how to use the flexibility of this approach to apply ABCT to different contexts and scenarios.

This paper categorizes and critiques the empirical research strategies that have been employed to test real options theory. Existing research has sought to detect valuable options in firms’ strategic investments as well as to investigate the payoffs from these investments. Our review highlights some of the evidence that has accumulated in recent years for real options theory. We flag some of the most important challenges and tradeoffs associated with the use of different empirical research approaches for testing real options theory in strategic management. The paper concludes by offering a number of research priorities to advance the theory by probing its descriptive validity as well as by addressing its normative aspirations to bridge corporate finance and strategy.

Board size has received significant attention among researchers and regulators. However, the advisory role of boards has not been studied much. In this study I examine the notion that investors value larger boards for their advisory capabilities. Prior studies examine board size in the context of monitoring role of corporate boards and find opposite effects on debt holders and equity holders. Using market-based measures of total firm performance, which take both equity and debt into account; I find that larger boards are associated with greater economic value added (EVA). Using a sample of S&P 1500 firms from 2000 to 2003 and controlling for various firm and industry characteristics, I also find that the board size is positively associated with firm productivity and various other efficiency measures such as return on assets (ROA), return on equity (ROE) and Sales-Turnover ratio. I argue that firms with larger boards, valuing the advisory role of directors offer greater compensation to the directors. Overall the results indicate that large board size has a positive impact on firm's performance. The results are robust to alternative measures of firm performance and other key variables.