The Effects Of Accounting And Market Indicators Towards Companies’ Performance In Amman Stock Exchange, Mediated By Stock Volatility
The efficient market hypothesis theorizes that current stock prices and returns reflect all relevant information. Stock prices and returns only change upon the emergence of new information. Firms must provide information to help investors make investment decisions. The concerns of owners, investors,...
Saved in:
| id |
my-usim-ddms-13075 |
|---|---|
| record_format |
uketd_dc |
| institution |
Universiti Sains Islam Malaysia |
| collection |
USIM Institutional Repository |
| language |
en_US |
| topic |
Investment analysis Accounting Marketing strategies |
| spellingShingle |
Investment analysis Accounting Marketing strategies Ahmad Abdallah Ahmed Alswalmeh The Effects Of Accounting And Market Indicators Towards Companies’ Performance In Amman Stock Exchange, Mediated By Stock Volatility |
| description |
The efficient market hypothesis theorizes that current stock prices and returns reflect all relevant information. Stock prices and returns only change upon the emergence of new information. Firms must provide information to help investors make investment decisions. The concerns of owners, investors, business partners, stakeholders, and creditors about the financial position of a company calls for appropriate performance measurement tools (i.e., discriminate between investment opportunities and effect of stock volatility). Most often, they rely on publicly available accounting and market indicators. There is also a lack of financial analysis techniques on financial indicators that can discriminate between performing and underperforming companies. The extant literature is inconclusive about the impacts of accounting and market indicators on stock price and return, likely due to its implicit assumption that they are direct. An alternative perspective, one that has met with little investigation, is that the impact may be influenced by a mediator, such as stock volatility. Against these issues, this study built on past research to: 1) investigate the impact of accounting and market indicators on stock price and return; 2) evaluate company performance and distinguish companies into performing and underperforming; and 3) investigate the mediating effect of stock volatility on relationships between accounting and market indicators and stock price and return. Therefore, investors and stakeholders can predict stock validity using indicators that reflect the performance of firms’ operating activities. Additionally, they enable policymakers and market regulators to make rational decisions to enhance investment policies. The study analyzed a panel data of 63 companies constituting the Amman Stock Exchange General Index from 2008 to 2018 using ordinary and generalized least squares regression models, multiple discriminant analysis, and structural equation modelling. The findings showed that: 1) earnings per share (EPS), return on asset (ROA), market capitalization (MC), stock turnover ratio (STR), and book value per share (BPS) significantly and positively affected stock price; 2) total asset turnover (TOA), ROA, EPS, STR, and price-to-book value (PBV) significantly and positively affected stock return; 3) STR, EPS, and TOA significantly discriminated between performing and underperforming companies; 4) stock price volatility fully and positively mediated the relationship between STR and stock price; and 5) stock return volatility fully and positively mediated the relationship between MC and STR and stock return. The results were robust, and they evinced that accounting and market indicators, which are the main references of financial information, are reflected on company performance. The results are expected to provide an informative guideline to researchers to design appropriate performance evaluation models (e.g., Z-score models and mediation models); investors to choose the best investment opportunities in ASE; and financial policymakers to improve investment policies in Jordan. Investors, especially, may refer to the findings to help them make short-term investment decisions. Academics could also adopt the novel research models to evaluate company performance while accounting for stock volatility, allowing them to identify high performing firms and rank companies by performance. Future studies may consider replicating the analysis in developed and other emerging markets. |
| format |
Thesis |
| author |
Ahmad Abdallah Ahmed Alswalmeh |
| author_facet |
Ahmad Abdallah Ahmed Alswalmeh |
| author_sort |
Ahmad Abdallah Ahmed Alswalmeh |
| title |
The Effects Of Accounting And Market Indicators Towards Companies’ Performance In Amman Stock Exchange, Mediated By Stock Volatility |
| title_short |
The Effects Of Accounting And Market Indicators Towards Companies’ Performance In Amman Stock Exchange, Mediated By Stock Volatility |
| title_full |
The Effects Of Accounting And Market Indicators Towards Companies’ Performance In Amman Stock Exchange, Mediated By Stock Volatility |
| title_fullStr |
The Effects Of Accounting And Market Indicators Towards Companies’ Performance In Amman Stock Exchange, Mediated By Stock Volatility |
| title_full_unstemmed |
The Effects Of Accounting And Market Indicators Towards Companies’ Performance In Amman Stock Exchange, Mediated By Stock Volatility |
| title_sort |
effects of accounting and market indicators towards companies’ performance in amman stock exchange, mediated by stock volatility |
| granting_institution |
Universiti Sains Islam Malaysia |
| url |
https://oarep.usim.edu.my/bitstreams/dd73e9bb-559c-418d-8792-4f5bc19a5097/download https://oarep.usim.edu.my/bitstreams/e65eabe0-54ec-44e6-8520-3a20c33de004/download https://oarep.usim.edu.my/bitstreams/571f7f14-15de-4c6a-807a-e7c12a122a3a/download https://oarep.usim.edu.my/bitstreams/46a7466b-8931-4490-b412-3850f3ffbc47/download https://oarep.usim.edu.my/bitstreams/e4f6f0b2-02bb-4094-b07e-7fbf0b58d35a/download https://oarep.usim.edu.my/bitstreams/51541731-2f3e-4ee7-8075-9c638f5fe13c/download https://oarep.usim.edu.my/bitstreams/915847cf-193a-406f-a524-4d16a7314ec4/download https://oarep.usim.edu.my/bitstreams/b5450b0c-497e-4b0a-97ef-9e63f8ac5b78/download https://oarep.usim.edu.my/bitstreams/12c87b4e-77a6-481d-be05-9fd29800b956/download https://oarep.usim.edu.my/bitstreams/166893b5-d09e-44e6-a063-0019a13f648a/download |
| _version_ |
1812444740834033664 |
| spelling |
my-usim-ddms-130752024-05-29T18:43:29Z The Effects Of Accounting And Market Indicators Towards Companies’ Performance In Amman Stock Exchange, Mediated By Stock Volatility Ahmad Abdallah Ahmed Alswalmeh The efficient market hypothesis theorizes that current stock prices and returns reflect all relevant information. Stock prices and returns only change upon the emergence of new information. Firms must provide information to help investors make investment decisions. The concerns of owners, investors, business partners, stakeholders, and creditors about the financial position of a company calls for appropriate performance measurement tools (i.e., discriminate between investment opportunities and effect of stock volatility). Most often, they rely on publicly available accounting and market indicators. There is also a lack of financial analysis techniques on financial indicators that can discriminate between performing and underperforming companies. The extant literature is inconclusive about the impacts of accounting and market indicators on stock price and return, likely due to its implicit assumption that they are direct. An alternative perspective, one that has met with little investigation, is that the impact may be influenced by a mediator, such as stock volatility. Against these issues, this study built on past research to: 1) investigate the impact of accounting and market indicators on stock price and return; 2) evaluate company performance and distinguish companies into performing and underperforming; and 3) investigate the mediating effect of stock volatility on relationships between accounting and market indicators and stock price and return. Therefore, investors and stakeholders can predict stock validity using indicators that reflect the performance of firms’ operating activities. Additionally, they enable policymakers and market regulators to make rational decisions to enhance investment policies. The study analyzed a panel data of 63 companies constituting the Amman Stock Exchange General Index from 2008 to 2018 using ordinary and generalized least squares regression models, multiple discriminant analysis, and structural equation modelling. The findings showed that: 1) earnings per share (EPS), return on asset (ROA), market capitalization (MC), stock turnover ratio (STR), and book value per share (BPS) significantly and positively affected stock price; 2) total asset turnover (TOA), ROA, EPS, STR, and price-to-book value (PBV) significantly and positively affected stock return; 3) STR, EPS, and TOA significantly discriminated between performing and underperforming companies; 4) stock price volatility fully and positively mediated the relationship between STR and stock price; and 5) stock return volatility fully and positively mediated the relationship between MC and STR and stock return. The results were robust, and they evinced that accounting and market indicators, which are the main references of financial information, are reflected on company performance. The results are expected to provide an informative guideline to researchers to design appropriate performance evaluation models (e.g., Z-score models and mediation models); investors to choose the best investment opportunities in ASE; and financial policymakers to improve investment policies in Jordan. Investors, especially, may refer to the findings to help them make short-term investment decisions. Academics could also adopt the novel research models to evaluate company performance while accounting for stock volatility, allowing them to identify high performing firms and rank companies by performance. Future studies may consider replicating the analysis in developed and other emerging markets. Universiti Sains Islam Malaysia 2021-06 Thesis en_US https://oarep.usim.edu.my/handle/123456789/13075 https://oarep.usim.edu.my/bitstreams/bdc83bbe-dc9f-480f-9bc3-def2b52d8aad/download 8a4605be74aa9ea9d79846c1fba20a33 https://oarep.usim.edu.my/bitstreams/dd73e9bb-559c-418d-8792-4f5bc19a5097/download 1fe610666e904bd8b661b74398daa9f8 https://oarep.usim.edu.my/bitstreams/e65eabe0-54ec-44e6-8520-3a20c33de004/download cb18453e75d123161cd5b2fefc64c01e https://oarep.usim.edu.my/bitstreams/571f7f14-15de-4c6a-807a-e7c12a122a3a/download 4e6f0e863409051a9efb347528814cbd https://oarep.usim.edu.my/bitstreams/46a7466b-8931-4490-b412-3850f3ffbc47/download a75df0b7c20c959be946f11788f93674 https://oarep.usim.edu.my/bitstreams/e4f6f0b2-02bb-4094-b07e-7fbf0b58d35a/download 380dcd9134c1ffefbeab5bc0bd145403 https://oarep.usim.edu.my/bitstreams/51541731-2f3e-4ee7-8075-9c638f5fe13c/download d50cc841d52a2beac9752011472a26ab https://oarep.usim.edu.my/bitstreams/915847cf-193a-406f-a524-4d16a7314ec4/download 3d1e1088fd6a5a8060e17f38ffa21015 https://oarep.usim.edu.my/bitstreams/b5450b0c-497e-4b0a-97ef-9e63f8ac5b78/download a2315c21767e1b593690c1709fd3ae13 https://oarep.usim.edu.my/bitstreams/12c87b4e-77a6-481d-be05-9fd29800b956/download e01ee2a3bf6d104ed0b1ccc90eb65c24 https://oarep.usim.edu.my/bitstreams/166893b5-d09e-44e6-a063-0019a13f648a/download 9e237feb5cbb3e26200d46c330105144 https://oarep.usim.edu.my/bitstreams/9ceecd40-4a81-4fc2-b2b0-721c15849649/download 68b329da9893e34099c7d8ad5cb9c940 https://oarep.usim.edu.my/bitstreams/d95a7adb-f1dc-49dd-b8b8-9c44cf50ee87/download e1120208bf18ec3f6711c0e8371f84d1 https://oarep.usim.edu.my/bitstreams/b2c1991b-6009-4712-9bca-4a09547de59d/download 994ac5461be53ebfa9e7c3962a712e4a https://oarep.usim.edu.my/bitstreams/1f3d555c-cc39-49b8-8746-223f60a17d07/download 2997976dabf7a3741b934d80a62273dd https://oarep.usim.edu.my/bitstreams/86cc2987-12ef-4d96-beca-e9ea23a555df/download 589f6047bba8ce6e46f8e8412872da7e https://oarep.usim.edu.my/bitstreams/ded41e20-dd99-4802-8c26-ecc3fb26f48f/download e3fcedf09dcd1dc38e3feef91f3f8f87 https://oarep.usim.edu.my/bitstreams/0b600829-9181-4a6e-a2ec-6c0f85849d92/download b574158f8dd39e8484a5dfabeb1a6f28 https://oarep.usim.edu.my/bitstreams/5498088c-5a77-4195-9fc5-6e9259dea798/download efbef33c8f2d20218fbb8639538288fe https://oarep.usim.edu.my/bitstreams/37aa23ae-3350-42b3-996d-67348c3e86b3/download 1a0deacd4c56a35ed5bc7820e251e045 https://oarep.usim.edu.my/bitstreams/2ff5cf1e-799e-4240-9618-70f84f85639a/download df825b322564137eb08bc93809e4ebf2 Investment analysis Accounting Marketing strategies |