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IMPACT OF ECONOMIC VALUE ADDED DYNAMICS ON STOCK PRICES FACT OR FALLACY NEW EVIDENCE FROM NESTED PANEL ANALYSIS

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13 Pages : 96-105

http://dx.doi.org/10.31703/gssr.2019(IV-III).13      10.31703/gssr.2019(IV-III).13      Published : Sep 3

Impact of Economic Value Added Dynamics on Stock Prices Fact or Fallacy: New Evidence from Nested Panel Analysis

Abstract

    Present scholarship targets to examine the robustness of EVA in Pakistan and information content while controlling prior research ignored firm-specific factors towards excess stock returns. The design of this research used panel data analysis whereby relevant, incremental information content and event analysis of EVA and conventional accounting performance measure via share prices is done by employing nested panel data analysis for 70 non-financial PSX listed companies from 13 industries for a study period of 2006-2015. Against prior research, EVA doesn’t add to the incremental information content of the model. Moreover asymmetric results were revealed using nested and separate regression analysis. This study is aimed to benefit stakeholders in the context of prudent investment choice. This study identifies ROA as the most important financial performance metric for local investor’s decision making. However firm-specific characteristics like financial leverage, liquidity, and firm size also play a pivotal role.

    EVA, Financial Leverage, Firm Size, Liquidity. Traditional Accounting Measures, Stock Returns.

    (1) Malik Adil Pasha
    Ph.D. Scholar Department of Management Sciences, Preston University, Islamabad, Pakistan.
    (2) Muhammad Ramzan
    Associate Professor, Department of Management Sciences, Preston University, Islamabad, Pakistan.
    (3) Muhammad Asif
    Visiting Faculty,Federal Urdu University of Arts, Science and Technology, Islamabad, Pakistan.
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Cite this article

APA

    APA : Pasha, M. A., Ramzan, M., & Asif, M. (2019). Impact of Economic Value Added Dynamics on Stock Prices Fact or Fallacy: New Evidence from Nested Panel Analysis. Global Social Sciences Review, IV(III), 96-105. https://doi.org/10.31703/gssr.2019(IV-III).13

CHICAGO

    CHICAGO : Pasha, Malik Adil, Muhammad Ramzan, and Muhammad Asif. 2019. "Impact of Economic Value Added Dynamics on Stock Prices Fact or Fallacy: New Evidence from Nested Panel Analysis." Global Social Sciences Review, IV (III): 96-105 doi: 10.31703/gssr.2019(IV-III).13

HARVARD

    HARVARD : PASHA, M. A., RAMZAN, M. & ASIF, M. 2019. Impact of Economic Value Added Dynamics on Stock Prices Fact or Fallacy: New Evidence from Nested Panel Analysis. Global Social Sciences Review, IV, 96-105.

MHRA

    MHRA : Pasha, Malik Adil, Muhammad Ramzan, and Muhammad Asif. 2019. "Impact of Economic Value Added Dynamics on Stock Prices Fact or Fallacy: New Evidence from Nested Panel Analysis." Global Social Sciences Review, IV: 96-105

MLA

    MLA : Pasha, Malik Adil, Muhammad Ramzan, and Muhammad Asif. "Impact of Economic Value Added Dynamics on Stock Prices Fact or Fallacy: New Evidence from Nested Panel Analysis." Global Social Sciences Review, IV.III (2019): 96-105 Print.

OXFORD

    OXFORD : Pasha, Malik Adil, Ramzan, Muhammad, and Asif, Muhammad (2019), "Impact of Economic Value Added Dynamics on Stock Prices Fact or Fallacy: New Evidence from Nested Panel Analysis", Global Social Sciences Review, IV (III), 96-105

TURABIAN

    TURABIAN : Pasha, Malik Adil, Muhammad Ramzan, and Muhammad Asif. "Impact of Economic Value Added Dynamics on Stock Prices Fact or Fallacy: New Evidence from Nested Panel Analysis." Global Social Sciences Review IV, no. III (2019): 96-105. https://doi.org/10.31703/gssr.2019(IV-III).13