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This research aims to analyse the financial performance of companies using one of the most used profitability indicators, the return on investment (ROI), which measures the company's performance in terms of the profit generated over time. To this end, several different methods are used to calculate the ROI indicator, considering the different calculation methods used by different authors over the years. The use of different ROI calculation formulas has been identified in the literature, leading to different conclusions. Based on a sample of 2805 Portuguese companies, it examines how the different indicators react to the different variables analysed, using nine different econometric models. Through this study, it is possible to verify that the different variables that depend on the return on investment have different results, namely that the variables "age" and "size" have a negative effect on the return on investment. On the other hand, "financial leverage" and "ROA" have a positive impact on the contribution to the return on investment. We also found that the different variables behave similarly for virtually all types of ROI calculation, although not completely harmonious, especially in terms of impact. The results are empirically vital, as they alert researchers and companies to the need for standardised formulas for calculating variables such as ROI so that results are not distorted. Using one to the detriment of the other impacts the results obtained and the analyses to be carried out. How empirical research will continue to use the ROI metric will always depend on its users' discretion and free will. [ABSTRACT FROM AUTHOR]

The assessment of a company's Return on Equity (ROE) is a challenging task for management. The main objective of this paper is to analyse the impact of government initiatives on the ROE of listed companies in India. The Indian government has taken many policy initiatives in the last decade to boost the infrastructure sector in the country. Therefore, it is worthwhile to evaluate how these policy initiatives have impacted the ROE of companies belonging to the infrastructure sector. 43 companies are selected for the purpose of the study. Both quantitative and qualitative methods are used for data analysis. Historical financial data from 2008 to 2023 is analysed using the DuPont model. Eleven industry experts, selected on the basis of their managerial experience in the infrastructure sector are interviewed and their opinions are coded using NVivo. The study finds that 67.4% of the variation in ROE is explained by three variables, namely asset turnover, financial leverage and operating profit margin. According to the industry experts, asset turnover and operating profit have a greater impact on ROE. The results of the study validate the accountability theory and are useful for policy makers and management of companies in the infrastructure sector in particular and other stakeholders in general who are interested in the relationship between government initiatives and their impact on the company's ROE. [ABSTRACT FROM AUTHOR]

We use proprietary data on intraday transactions at a futures brokerage to analyze how implied leverage influences trading performance. Across all investors, leverage is negatively related to performance, due partly to increased trading costs and partly to forced liquidations resulting from margin calls. Defining skill out‐of‐sample, we find that relative performance differentials across unskilled and skilled investors persist. Unskilled investors' leverage amplifies losses from lottery preferences and the disposition effect. Leverage stimulates liquidity provision by skilled investors, and enhances returns. Although regulatory increases in required margins decrease skilled investors' returns, they enhance overall returns, and attenuate return volatility. [ABSTRACT FROM AUTHOR]

Hedge fund positions are an important component of crowded trades. These vehicles are particularly active, take highly concentrated positions, and utilize leverage and short sales. Using a database of hedge fund holdings, we measure the degree of security-level crowdedness. The difference between the average returns on portfolios sorted by high versus low crowdedness portfolios is sizable, and the variation in the realized portfolio returns is distinct from other traditional risk factors. Further, hedge fund exposures to crowdedness are often significant, and they help to explain downside "tail risk," as funds with higher exposures experience relatively larger drawdowns during periods of industry distress. Authors have furnished an Internet Appendix , which is available on the Oxford University Press Web site next to the link to the final published paper online. [ABSTRACT FROM AUTHOR]

Copyright of Polish Journal of Management Studies is the property of Czestochowa University of Technology, Faculty of Management and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Global Journal of Economics & Business is the property of Refaad for Studies, Research & Development and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Journal of Economic Administrative & Legal Sciences is the property of Arab Journal of Sciences & Research Publishing (AJSRP) and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

We show that constraints can improve financial decision-making by disciplining behavioral biases. In financial markets, restrictions on leverage limit traders' ability to borrow to open new positions. We demonstrate that regulation that restricts the provision of leverage to retail traders improves trading performance. By increasing the opportunity cost of postponing the realization of losses, leverage constraints improve traders' market timing and reduce their disposition effect. We replicate these findings in two distinct experimental settings, further isolating the mechanism and demonstrating generality of the results. The interaction between constraints and behavioral biases has implications for policy and choice architecture. [ABSTRACT FROM AUTHOR]

Capital Structure (CS) of an organization and its composition has always affected its business performance and value creation. The selection of appropriate CS helps an organization to sustain its growth in the future. It is dependent on the level of financial leverage it is going to consider for optimal combination of CS. The study explores the impact of financial leverage on the business results of manufacturing firms in emerging economies like India for the period 2011 to 2021. The choice of appropriate combination of debt level will affect the profitability of a firm. It was found that there is an inverse association between Short-Term Debt (STD), Long-Term Debt (LTD) and size and business performance of the manufacturing industry in India. An empirical model was developed to analyze the impact on Return On Equity (ROE), Return on total Assets (ROA) and Return on Capital Employed (ROCE), which was found to be significant and established a negative association with financial leverage of firms. [ABSTRACT FROM AUTHOR]

In this study, listed manufacturing companies in Borsa İstanbul are examined for the 2017-2021 period to reveal their motives for revaluing Property Plant and Equipment. Financial Leverage (LEV), Return on Assets (ROA), Return on Equity (ROE), Market Value/Book Value (M/B), and Earnings Per Share (EPS) ratios are compared based on borrowing capacity, political costs, and information asymmetry theories. Results reveal that there is no difference between the pre and post revaluation periods. However, revaluing and non-revaluing companies exhibit statistically sifgnificant differences in ROA, ROE, and EPS. It may indicate that revaluing companies use revaluation to improve their equity and total assets. [ABSTRACT FROM AUTHOR]

In this article, gold is analyzed from an investment perspective as an asset that allows you to increase your wealth. The analysis is twofold. First, it is about examining to what extent changes in gold prices in the world markets translate into changes in the prices of shares of companies that extract gold. second, it was checked whether there is a financial leverage effect, which in this case means that changes in the price of shares of gold mining companies are greater than changes in the price of gold itself. Methodically, the sharpe model was used and two basic parameters of the model were estimated, i.e. the intercept (alpha), and the beta coefficient as a measure of systematic risk, for the gold market and the equity market of gold mining companies and etFs based on these companies. the research carried out in accordance with the logic of the sharpe model shows that the obtained value of the alpha parameter for the stock market was positive, while for the gold market it was negative. at the same time, higher levels of this parameter are beneficial to the investor, which means that an advantage of the stock market over the gold market exists. In turn, the estimated beta for the stock market is much lower than for the gold market. the systematic risk level for stocks is 0.45, and for the gold market it is 1.98, which is a significant difference. the stocks of gold mining companies can be classified as defensive against the stock market (the rate of return of the gold mine stock is insensitive to market movements) and aggressive against the gold market (the rate of return of the gold mine shares reacts more strongly than the movement in the price of gold). [ABSTRACT FROM AUTHOR]

Global awareness of damage to nature has increased over the years as a result of the reflections of the technological developments in the production sector. Firms have started to prepare sustainability reports that include social and environmental issues apart from economic reports. Stakeholders follow not only the financial data of companies but also their sustainability activities. Studies indicate that companies that attach importance to sustainability are seen as valuable by investors. This has increased the research that affects the relationship between sustainability reporting and firm performance. The purpose of this study is to empirically examine whether the financial performance indicators of companies have an effect on publishing sustainability reports. The variables of Return on Assets, Return on Equity, Net Profit Margin, Size and Financial Leverage were used as the financial performance indicator. 351 firm/year data between the years 2014-2021 of 44 firms included in the BIST Sustainability Index was used. The effect of the variables in publishing sustainability report was analyzed with logistic regression method, which is used when the dependent variable is categorical. The results indicate that variables other than size do not have a significant effect, but companies tend to publish sustainability reports as their financial size increases. [ABSTRACT FROM AUTHOR]

Copyright of Business Consultant / Poslovni Konsultant is the property of FINconsult Ltd. and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The article presents an approach to the corporation's capital structure management based on the criterion of maximizing the return on equity (ROE). The basis of this approach is the determination of the expediency of attracting borrowed resources from the point of view of balancing financial risk and profitability. The toolkit for optimizing the capital structure of the corporation is substantiated, taking into account the indicator of financial leverage, which ensures the most effective proportionality between profitability and financial stability. An algorithm for determining the level of financial risk in the structure of the interest rate for attracting borrowed resources has been developed, which involves the formation of the amount of the premium for the risk of insolvency of the borrower and the corresponding methodology for determining the position of the borrower on the scale "financial stability–solvency–financial risk". The post-optimization multifactor sensitivity analysis of the proposed capital structure optimization model made it possible to establish certain patterns regarding changes in ROE and its components. [ABSTRACT FROM AUTHOR]

The study aims at evaluating the performance of Palestinian Islamic banks for the efficiency of managing financing risks and linking them with the quality of investment portfolios according to the modified return on equity model (DuPont) and bank financial ratios, also to identify the types of risks of Islamic financing instruments, And the volume of investments using Islamic financing formulas, To achieve the objectives of the study, the researcher used the descriptive and analytical comparative approach to the case study, The sample of the study consisted of the Palestinian Islamic Bank and the Arab Islamic Bank since they are the most active Islamic banks in Palestine. The results of the study showed that the average of the return on equity index according to DuPont model of the Palestinian Islamic Bank was 12.5% compared to the Arab Islamic Bank, which scored 6.8%, this is due to the high rate of return on assets and financial leverage in the Palestinian Islamic Bank, the results also indicated that the financing risks in the Palestinian Islamic Bank are greater with sufficient provision, As a result, its returns increased compared to the Arab Islamic Bank. The study also showed results that reflect the efficiency and remarkable success of the Islamic banks in the process of managing credit risks. This reflected positively on the performance index of those banks by building good quality credit portfolios, which enabled them to compete with traditional banks. The study concluded that Islamic banks should diversify and develop their financing instruments and direct them towards productive investment opportunities and raise the degree of cooperation in the field of credit information exchange. [ABSTRACT FROM AUTHOR]

We conducted the first profitability comparison study across health care industries in the United States, using the DuPont Analysis framework. The combination of Return on Equity (ROE) and ROE volatility was used to provide a comprehensive "risk-return" approach for profitability comparison. Based on the 2010–2019 financial disclosures of 1,231 publicly traded health care companies in the U.S. that reported positive assets and equity, we estimated the industry-specific fixed effects on ROE and its three components—profit margin, asset utilization, and financial leverage—for ten industries in the health care sector, classified by the Global Industry Classification Standard (GICS). For each industry, we also estimated its fixed effects on ROE volatility. We found that the pharmaceuticals industry and biotechnology industry have lower ROE—mainly driven by their relatively low profit margin and low assets utilization—and higher ROE volatility than other health care industries. We also found that the health care facilities industry relies most on debt financing. This study demonstrates a holistic approach for profitability comparison across industries. [ABSTRACT FROM AUTHOR]

The aim of this paper is to compute various measures to examine the determinants of financial profitability for the listed Indian public sector banks. This paper will also identify the relationship between the return on equity (ROE) and other independent variables of the Indian banking sector, including all public sector banks, over the past 11 years, starting from April 1, 2009, to March 31, 2020. Therefore, a sample of 12 registered public banking companies and a total of 120 balanced observations are selected for the purpose of analysis. The author has used financial profitability as a dependent variable, represented by the return on equity (ROE), and return on assets (ROA), financial leverage (FL), and credit deposit ratio (CDR) as independent variables. In this study, both fixed effects and the random effects model have been used to look at panel data regression. The author also confirmed both panel techniques with Hausman test-correlated random effects, a widely used procedure for selecting a panel effect. For testing series stationarity, the author used the PP-Fisher 2; ADF-Fisher 2; Levin, Lin, and Chu t; Im, Pesaran, and Shin W-stat; and Breitung t-stat. The results show that return on assets (ROA) and financial leverage (FL) increased the effectiveness of banks in India, while the credit deposit ratio (CDR) reduced the profitability of all public sector banks in India. Only two variables, FL and ROA, were found significant under public sector banks, while taking ROE as the dependent variable. On the other hand, the overall PSB data showed that the CDR reduced the profitability of total PSBs in India. The conclusion of this study will help policymakers, financial managers, and investors in making investment decisions. [ABSTRACT FROM AUTHOR]

A stable and healthy insurance industry plays a vital role in sustaining an economy resistant to economic shocks by providing an efficient risk-transition mechanism. There is a relative scarcity of research inspecting the impact of insurers' financial insolvency on the profitability of insurance firms. Employing 2011–2019 panel data of 16 non-life insurance companies operating in Bangladesh, this research endeavors to examine the impacts of insurers' financial insolvency on the profitability of insurance companies measured by return ratios, return on assets (ROA), and return on equity (ROE). Fixed-effect regression outcome implies that insurers' financial insolvency has a significant adverse influence on non-life insurance companies' profitability. Further findings indicate that financial leverage, technical provision, age, and inflation have a noteworthy adverse influence on profitability. The outcomes of this research are of greater significance for policymakers in tackling insolvency and formulating policies to boost the growth of insurance profitability. In addition, this study aims to serve as a benchmark for other countries' insurance industries to emulate recovery strategies from financial insolvency. [ABSTRACT FROM AUTHOR]

This present research is conducted to probe the impact of company’s’ Financial-Leverage on its Performance, the research-data pursued and collected for listed manufacturing sector of Pakistan from State Bank of Pakistan via Financial-Statements analysis. Time- series-data is collected from 2009-2019. The research is based upon Ratio and Return on Assets, Return on Equity are as Independent-Variable and Net-Profit margin are Dependent-Variable, the research is mechanized by applying the Regression-Model by using SPSS. Manufacturing sector is performing a crucial function in the Developing and Developed-Economies. It offered maintain for EconomicDevelopment of country by depicting encouraging trends for growth towards the sector, helping as a control for the growth of firm’s various working areas like; textile, cement and iron. It offers extensive contribution for production, trade and service. Generally, perceived the financial leverage is helpful to boost up the Financial-Performance of the Company. The study is aimed at checking the Hypothesis and to comprehend the contact of Financial-Leverage on the Firm Financial outcomes of the manufacturing sector of Pakistan. The study’s core objective is to observe that the entities acquire work with high profits may be leads to choice High-Leverage by using different statistical techniques and tools. The study highlights Financial-Leverage positively affects the company Financial Performance. By affirming the alternate hypothesis H1 and Ho is rejected. Further, analysis substantiates High-Profit earning entities make sure of feasible liquidity situation s to acquire significant Financial-Performance of entity. This orientation has significant impact on the manufacturing sector in Pakistan in Financial- Leverage on its sustainability and significance. [ABSTRACT FROM AUTHOR]

The purpose of this study was to measure the impact of financial leverage on the performance of 424 Pakistani nonfinancial listed companies over the 2001–2017 period. Three measures of financial leverage, i.e., short-term debt (STDL), long-term debt (LTDL), and total debt (TLEVR), were applied to examine their impact on performance, i.e., sustainable growth (SGR), Tobin's Q, return on assets (ROA), return on equity (ROE), and return on sales (ROS). Robust results obtained using the generalized method of moments (GMM) report a significant negative impact of financial leverage on performance. The results also confirm an inverted U-shaped relationship between financial leverage and performance, indicating that an increase in the financial leverage of Pakistani listed companies increases their performance up to a certain level, and after that, a further increase in financial leverage decreases their performance. The results further suggest that STDL is a main contributing source of debt that causes a higher risk of refinancing for companies and thus negatively affects performance. This study's findings are useful for academics, management, policymakers, and regulators to understand the importance of financial leverage and to choose between STDL and LTDL to fund financial needs. [ABSTRACT FROM AUTHOR]

Corporate social responsibility (CSR) has become a crucial issue for firms seeking to achieve sustainable development. To achieve transparent CSR, firms usually publish their environmental initiatives and accomplishments—otherwise known as an environmental information disclosure (EID). There is a growing interest in the incentives behind EID and the implications for firms' market capitalization and profitability. However, existing EID studies are mainly rooted in the manufacturing industry; there is a dearth of research related to the construction industry. It is still unclear whether construction engineering firms with superior financial conditions (i.e., doing well financially) have the incentives to signal and distinguish themselves from others by making more extensive EID (i.e., doing good environmentally). Therefore, this study conducts a secondary data analysis of 60 listed construction firms. The results reveal that the financial leverage (i.e., liabilities to assets ratio) is negatively correlated with the level of EID, whereas the relationship between financial performance (i.e., return on equity) and EID is not significant. Furthermore, the ownership structure (i.e., the proportion of state-owned equity) yields a negative moderating effect on the relationship between financial leverage and EID, i.e., the ownership structure buffers firms from (rather than binds firms to) institutional pressures. This study contributes to extending the influencing mechanism of financial conditions and shedding new light on governing environmental responsibility in construction firms. [ABSTRACT FROM AUTHOR]

Purpose: The objective of this study is to examines the impact of financial leverage on the performance of listed manufacturing companies in Sri Lanka. Methodology: The present study employed ratio analysis to examine whether the financial leverage in listed manufacturing firms in Sri Lanka affected their performance involving the financial performance indicators of return on assets (ROA), return on operating assets (ROOA), return on net operating assets (RNOA), return on equity (ROE) and the impact on the financial level indicators as the debt to equity (DE) and financial spread. Findings: The results found both a positive and negative relationship between financial leverage and the firms' performance using two different methods of analysis (overall business analysis and main business analysis). The overall business analysis showed a positive relationship between financial leverage and firm performance, which supports the agency cost theory of financial leverage, whereas the main business analysis showed a negative relationship between financial leverage and the firms' performance. Originality/Value: The article presents significant evidence in terms of its scrupulous approach towards checking the toughness of results. The article offers insights to the capital structure and the performance of manufacturing companies in Sri Lanka which helps to investors, managers and debtors on their investment decision. [ABSTRACT FROM AUTHOR]

The paper intends to measure the effects of Mergers & Acquisitions (M&As) on the stock prices and Financial Performance (FP) of the acquirer banks in India. A list of 28 M&As concerning acquirer banks registered on the National Stock Exchange (NSE), is used in this study. Event study analysis is used to gauge the outcome of M&As announcement on the market price of the banking company's share, which measures the wealth creation of acquiring firm's shareholders. DuPont (DP) analysis is used for the purpose of analyzing the FP of merged firm, but it failed to show any significant impact post merger in terms of Return on Assets (ROA), Return on Equity (ROE), net-profit margin, financial leverage and asset turnover. The fallouts designate that the market reacted negatively towards the M&As in banking sector of India, and also show a corrosion in the performances of the acquirer banks in the post-merger period. [ABSTRACT FROM AUTHOR]

Copyright of Journals Eduction for Girls is the property of Republic of Iraq Ministry of Higher Education & Scientific Research (MOHESR) and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This study employed propensity score matching and regression analysis to determine whether or not a retention scholarship pilot program at a mid-size public research university was effective at increasing first-year retention. The scholarship pilot did not require any application process for students but rather used a predictive logistic regression model for identifying recipients and automatically awarded students $5,000. The scholarship was only awarded for the students' sophomore year. The award was not continued as students persisted to their junior and senior years. Findings demonstrated that students who did not receive the scholarship were two times more likely to depart from the institution at the end of their first year compared with scholarship recipients. Longitudinally, nonscholarship recipients were 1.4 times more likely to depart at the end of their sophomore year. [ABSTRACT FROM AUTHOR]

Some aspects of bank strategic management are defined in the article. Efficiency econometric modelling of one of the leading banks operating at Ukrainian financial market was performed using Statistica and Excel PCs. To establish appropriate correlations, the three inputs that were most affected during the coronavirus pandemic were identified: net interest margin, financial leverage ratio, and profitability of personnel costs. There are selected two parameters as one of the main indicators of banking institution efficiency: return on assets and return on equity. The dependences response surfaces of return on assets and return on equity based on the following combinations are constructed: net interest margin and financial leverage ratio; net interest margin and profitability of personnel costs; the financial leverage ratio and profitability of personnel costs. Correlations between different combinations of input variables and their effect on outputs have been established. The limits within which each input parameter should be in order to cause the best results of output parameters have been determined. In order to define those bank's activity areas that require the most attention, models of time dependences have been built for: net interest margin; financial leverage ratio; profitability of personnel costs; return on assets and return on equity. The milestones of the researched bank have been identified. A number of proposals have been developed to improve the strategic management of the banking institution based on the conducted analysis. It is defined that the effectiveness of banking institutions strategic management depends on the timeliness and objectivity of changes forecast, the reliability of information flows and the quality of monitoring and control of various business processes for customers, shareholders and society as a whole. [ABSTRACT FROM AUTHOR]

Purpose: The present study sought to investigate whether tax management influences the cost of equity of Brazilian companies listed in Brazil, Methodology: The study included the analysis of the Proxie Book-Tax Differences (BTD) as a tool for identifying tax management, as suggested in the work of Moreira e Silva (2019), as well as the control variables, which are the return on equity (ROE), market value (QTOBIN), company size (LNAT) and company financial leverage (ALV). For data collection, the Bloomberg® database and the Reference Form available on the B3 website were used. For that, it was used the Multiple Linear Regression of the data type in balanced panel, resulting in a final sample formed by 630 observations. Results: Through the BTD proxie, referring to the difference between accounting profit and tax profit, and used to capture tax management in this research, it was not possible to identify any relationship with the cost of equity. Thus, for the purposes of this research, the theoretical adequacy and the statistical models used did not show that good tax management practices have a positive or negative effect on the cost of equity. Contributions of the Study: It is observed that Brazilian studies did not analyze the effect of tax management on the cost of equity in Brazilian companies using the Book-Tax Differences (BTD) indicator as a tool for identifying tax management and its influence on the cost of capital. So, this research followed the recommendation suggested by Moreira e Silva (2019), to analyze this cost with another indicator, in this case, Book-Tax Differences (BTD). According to the results, it was not possible to identify any relationship with the cost of equity, thus contributing to the consolidation of the findings by Goh et al. (2016) and Moreira e Silva (2019) who present CashETR as the best metric for tax management, given that the results presented using the variables ETR and BTD, demonstrated that the cost of capital required by investors was unrelated to the fiscal aggressiveness of companies. Bolsa e Balcão (B3) in the period from 2014 to 2018. [ABSTRACT FROM AUTHOR]

Copyright of Itobiad: Journal of the Human & Social Science Researches / İnsan ve Toplum Bilimleri Araştırmaları Dergisi is the property of Itobiad: Journal of the Human & Social Science Researches and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This research aims to propose a model adding to the competitiveness of companies by identifying factors that determine the profitability of the selected companies (both publicly traded and unquoted private companies of all sizes). Another aim is to prove a dichotomy between the motivation of equity holders and senior lenders as far as acceptable financial leverage is concerned. The paper is innovative based on its combination of several different factors influencing corporate profitability (i.e. firm-specific effects: current ratio, labor cost ratio, working capital financing ratio, long-term financing ratio, return on sales, age of the firm; industry-specific effects and other macroeconomic effects) and by assessing determinants concerning the interests of shareholders and other stakeholders using a panel regression analysis with fixed effects. The authors prove that the determinants of the operating performance of Czech trading companies differ substantially when the performance is measured by ROA or by ROE. This clearly shows discrepancies between the equity holder interest to maximize their returns on investment and the other stakeholder interests. Specifically, the authors have found that the leverage, both in terms of working capital and long-term financing, negatively impacts returns on assets. On the other hand, it positively impacts returns for equity holders both in the Wholesale and Retail sub-samples. Interestingly, other determinants of operating performance, such as capital intensity, labor cost ratio, historical profitability, and macroeconomic variables, are of comparable significance, impacting both the ROA and ROE analyses. [ABSTRACT FROM AUTHOR]

Copyright of Muhasebe ve Vergi Uygulamalari Dergisi (MUVU) / Journal of Accounting & Taxation Studies (JATS) is the property of Ankara Serbest Muhasebeci Mali Musavirler Odasi and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The bank's performance is its ability to generate sustainable profitability. Although banking institutions have become increasingly complex, the key factors in their performance remain earnings, risk-taking efficiency and financial leverage. The countries of the Western Balkans have some common features: the history of socioeconomic development, the transformations that have taken place, the reforms undertaken, liberalization, restructuring and the path to development. Their financial sector is primarily bank-based, so the soundness of the banking sector is significantly important for the stability and progress of their economies in the long term. Using a qualitative and quantitative analysis, the main objective of this paper is to generate and explain the main features about the role and financial performance of banks in the Western Balkans. The research methodology is based in explaining through a descriptive and graphical analysis, the particularities of the main banking systems in Albania, Bosnia and Herzegovina, North Macedonia and Serbia, presenting the four main performance measurement indicators: return on assets (ROA), return on equity (ROE), cost-to-income ratio and net interest margin. Analyzing the data for the period 2000-2019, it was assessed that the region is quite consistent in terms of the performance of the banking sector, the latter being almost equally dynamic for all four countries. The regional economic environment does not favor the stability of the financial system, but prevents the increase of the efficiency and productivity of the banking sector. [ABSTRACT FROM AUTHOR]

Purpose: This paper presents a model for determining the optimal capital structure for cooperatives and explores the relationship between financial leverage and the ability of cooperatives to retire member equity. Design/methodology/approach: A model is developed to determine the optimal capital structure and explore the relationship between capital structure and the rate at which a cooperative can retire member equity. Using data from cooperative financial statements, ordinary least-squares regressions are conducted to test two hypotheses on capital structure and equity retirement. Findings: The model shows that the optimal capital structure is determined by the ratio of the rate of return on capital employed to the interest rate on borrowed capital and the required level of interest coverage. The regressions suggest that cooperatives choose their capital structure largely according to the rate of return on capital employed and the interest rate in a manner consistent with maximizing the rate of return on equity and that the rate at which cooperatives can retire member equity is directly related to leverage. Research limitations/implications: The model does not consider unallocated earnings. Analysis of the relationship between leverage and equity retirement yields results contrary to the assumptions of earlier studies. Practical implications: Cooperatives can use the model because the necessary parameters are easily understood and readily available from financial statements, lenders and industry sources. Originality/value: The model is developed specifically for determining the capital structure of cooperatives and differs substantially from the corporate model. A theoretical basis is provided for the relationship between leverage and equity retirement. [ABSTRACT FROM AUTHOR]

The article discusses how Return on investment (ROI) is calculated for investments in forecasting software and talent, and the different factors that need to be considered. It mentions investment in demand planning resources; and also mentions labor savings generates the expected financial benefit from the project investment.

The paper evaluates and analyses selected financial ratios of a set of farms in Slovakia in 2017. The farms are divided into two groups (sugar beet producers and sugar beet non-producers). The data used for the analysis were obtained from the National Bank of Slovakia (NBS) over the period 2009 – 2017 and the database of the Ministry of Agriculture and Rural Development of the Slovak Republic (MARD SR). Farmers generally achieve a low level of return on equity. In the paper, we analyze the development of interest rates and measure the potential effect of financial leverage, which can increase the profitability (return on equity) of the farms. Moreover, we test the statistically significant difference of selected ratios between the group of producers and non-producers of sugar beet in Slovakia. In 2017, the return on equity of sugar beet producers in Slovakia reached lower results in comparison to sugar beet non-producers. The differences in return on equity are explained by the lower level of equity per ha and thus higher indebtedness of non-producers of sugar beet. [ABSTRACT FROM AUTHOR]

Banks are regulated more than most firms, making them good subjects to study regulatory arbitrage (avoidance). Their latest arbitrage opportunity may be the new leverage rule covering the largest U.S. banks; leverage rules require equal capital against assets with unequal risks, so banks can effectively relax the leverage constraint by increasing asset risk. Consistent with that conjecture, we find that banks covered by the new rule shifted to riskier, higher yielding securities relative to control banks. The shift began almost precisely when the rule was finalized in 2014, well before it took effect in 2018. Security level analysis suggests banks actively added riskier securities, rather than merely shedding safer ones. Despite the risk shifting, overall bank risk did not increase, evidently because the banks most constrained by the new leverage rule significantly increased leverage capital ratios. [ABSTRACT FROM AUTHOR]

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Our research investigates the performance of companies from Central and Eastern European (CEE) countries in the period after the Global Financial Crisis of 2007-2009 with the aim of identifying the driving factors behind accounting- and market-based performance. We include in the analysis companies from various industries in CEE countries that are European Union members and we study their performance between 2008-2016 over the following areas of performance: liquidity, solvency and indebtedness, operational profitability, global performance (through Return on assets and Return on equity), returns available to shareholders and market-based performance (through price/book value and Tobin Q ratio). Employing the hierarchical and non-hierarchical k-means cluster analysis companies are segmented into various homogeneous groups using various financial performance indicators as variables, Euclidian distances and the Ward amalgamation method. Furthermore, the resulting clusters have been grouped according to the country of origin and industry. Our findings show that specific groups of companies in these countries share common attributes, as evidenced by their performance indicators, which do not seem to be entirely based on their countries of origin and industry. Moreover, our exploration of CEE companies' performance dynamics after 2008 evidences the increased competition in all industries particularly after 2009, as well as businesses' need to adjust their activities after the losses incurred during the crisis period, but these phenomena is present with different intensities depending on country of origin and industry. At the same, we note the enhancement of global performance through improvements in the operational performance instead of financial leverage and indebtedness, which is a sound business approach by CEE companies. [ABSTRACT FROM AUTHOR]

With the help of a simple question juxtaposing geared and ungeared positions, this paper analyzes the inherent ambiguity present in the concept of financial leverage. The answer to this question depends on the way it is (often automatically) understood. It may be perceived as being either about risk, risk reward or a mix of the two. The range of possible answers is virtually unlimited. Unfortunately, most of them, including that given by Miller in his Nobel Prize Lecture, are inconsistent with finance theory. This paradox is represented by the inability to answer the simple question in an unambiguous way, yet its gravity comes from the fact that it is neither noted nor debated in the literature. The confusion surrounding financial performance evaluation, ROE debate or executive pay are just a few examples of how lethal the leverage paradox can be. The leverage-driven financial crisis of recent years shows that the chaos in the literature exemplified by the paradox may easily spill over into real life. [ABSTRACT FROM AUTHOR]

This article proposes a trading-based explanation for the asymmetric effect in daily volatility of individual stock returns. Previous studies propose two major hypotheses for this phenomenon: leverage effect and time-varying expected returns. However. leverage has no impact on asymmetric volatility at the daily frequency and, moreover. we observe asymmetric volatility for stocks with no leverage. Also, expected returns may vary with the business cycle, that is, at a lower than daily frequency. Trading activity of contrarian and herding investors has a robust effect on the relationship between daily volatility and lagged return. Consistent with the predictions of the rational expectation models, the non-informational liquidity-driven (herding) trades increase volatility following stock price declines, and the informed (contrarian) trades reduce volatility following stock price increases. The results are robust to different measures of volatility and trading activity. [ABSTRACT FROM AUTHOR]

We examine differences in financial leverage between parent and spun-off firms that emerge from corporate spin-offs. Our tests control for past financing choices and the costs of adjusting capital structure, factors that can obscure cross-sectional patterns among firms' target leverage ratios. We find that firms that emerge from spin-offs with more financial leverage have a higher cash flow, return on assets, lower variability of industry operating income, and a greater proportion of fixed assets. The positive relation between profitability and the use of financial leverage, in a setting that is free of pecking order effects, is particularly important because it contrasts with existing evidence. Our results indicate that the ability to cover debt payments and default-related costs are important determinants of the use of financial leverage, as implied by the trade-off theory of capital structure. We find no evidence that managerial incentives or governance characteristics affect the difference in leverage ratios in firms that emerge from spin-offs. [ABSTRACT FROM AUTHOR]

We examine 82 situations where the market value of a company is less than its subsidiary. These situations imply arbitrage opportunities, providing an ideal setting to study the risks and market frictions that prevent arbitrageurs from immediately forcing prices to fundamental values. For 30 percent of the sample, the link between the parent and its subsidiary is severed before the relative value discrepancy is corrected. Furthermore, returns to a specialized arbitrageur would be 50 percent larger if the path to convergence was smooth rather than as observed. Uncertainty about the distribution of returns and characteristics of the risks limits arbitrage. [ABSTRACT FROM AUTHOR]

Diversified firms have different values from comparable portfolios of single-segment firms. These value differences must be due to differences in either future cash flows or future returns. Expected security returns on diversified firms vary systematically with relative value. Discount firms have significantly higher subsequent returns than premium firms. Slightly more than half of the cross-sectional variation in excess values is due to variation in expected future cash flows, with the remainder due to variation in expected future returns and to covariation between cash flows and returns. [ABSTRACT FROM AUTHOR]

The intertemporal CAPM predicts that an asset's price is equal to the expectation of the product of the asset's payoff and a representative consumer's intertemporal marginal rate of substitution. This paper develops an alternative approach to asset pricing based on corporations' desire to hoard liquidity. Our corporate finance approach suggests new determinants of asset prices such as the distribution of wealth within the corporate sector and between the corporate sector and the consumers. Also, leverage ratios, capital adequacy requirements, and the composition of savings affect the corporate demand for liquid assets and, thereby, interest rates. [ABSTRACT FROM AUTHOR]

The privatisation and liberalisation waves have been increasing the number of private companies in the aviation industry. This, in turn, necessitates new policy analyses on major financial decisions regarding capital structure, corporate governance and investments. Among these major topics, the research about the association between capital structure and financial performance of the aviation companies largely focuses on the airlines. But a comparable analysis for the airport companies is less explored. The goal of this study is to contribute to the literature by analysing how the capital structure of the publicly traded airport companies affects their profitability and market valuation. Using an unbalanced panel data sample of 29 publicly traded airports from 20 countries over the 1989-2017 period, our findings suggest that higher total and long-term leverage tend to decrease return on assets whereas they are positively associated with return on equity. [ABSTRACT FROM AUTHOR]

Ceramic is a sundry industry and contains a number of categories of products, including sanitaryware, refractory's cement, advanced ceramics and ceramic tiles. The Indian ceramic industry is about 100 years old. The objective of the present study is to find out the relation between capital structure and profitability of eight selected ceramic companies during the period of 10 years from 2008 to 2017. Return on Equity (ROE), current ratio, debt-equity ratio and degree financial leverage have been used as the parameters of the study. As statistical measure, correlation matrix and one-way ANOVA test have been used for data analysis. The findings reveal that a few of the sample companies show positive and a few show negative correlation between ROE and the ratios of capital structure. [ABSTRACT FROM AUTHOR]

This paper examines the impact of capital structure on corporate performance. The study is based on secondary data of sixteen listed large-sized power sector companies forming part of the BSEPOWER index as identified from the Capitaline database for the period 2006-2017. The corporate performance is proxied using two accounting measures viz. return on asset (ROA) and return on equity (ROE). Leverage is taken as the independent variable which is measured not only by the overall debt-equity ratio but also long-term and short-term debt ratios. The square of these leverage measures is taken to test the linearity of the relationship. The control variables include size, tangibility, liquidity and age of the firm. The study reveals a mixed result. While the impact of leverage on ROE is positive, the impact on ROA is negative. 'Size' shows a significant negative effect in all cases in contrast to positive effect in few cases only. Liquidity and operating expense ratio do not have a significant influence on corporate performance. [ABSTRACT FROM AUTHOR]

Building on theoretical asset pricing literature, we examine the role of market risk and the size, book‐to‐market (BTM), and volatility anomalies in the cross‐section of unlevered equity returns. Compared with levered (stock) returns, unlevered market beta plays a more important role in explaining the cross‐section of unlevered equity returns, even after controlling for size and BTM. The size effect is weakened, while the value premium and the volatility puzzle virtually disappear for unlevered returns. We show that leverage induces heteroskedasticity in returns. Unlevering returns removes this pattern, which is otherwise difficult to address by controlling for leverage in regressions. [ABSTRACT FROM AUTHOR]

The data show that, upon being hit by adverse profitability shocks, large public firms have ample latitude to divest their least productive assets, reducing the risk faced by shareholders and the returns that they are likely to demand. In the one‐factor production‐based asset pricing model, when the frictions to capital adjustment are shaped to respect the evidence on investment, the model‐generated cross‐sectional dispersion of returns is only a small fraction of that documented in the data. Our conclusions hold even when operating or labor leverage is modeled in ways shown to be promising in the extant literature. [ABSTRACT FROM AUTHOR]

The net income of the organization is not enough to determine its efficiency and performance unless profit margin, asset turnover, financial leverage, etc. are taken into consideration. The present study examines whether Indian Information Technology (IT) companies are able to generate positive Return on Equity (ROE) for its shareholders and to ascertain improvement in ROE by using IT companies data for the period 2007-2016. The paper calculates ROE using three-factor DuPont model. Empirical analysis of the study shows that ROE is better in creating positive shareholder value, and it is also found that ROE can be improved by better asset turnover and profit margin. This paper suggests that further study can be conducted by using extended DuPont model. This enhanced study may strengthen the modern technique of performance measurement. [ABSTRACT FROM AUTHOR]