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Empirical Analysis Of The Role Of The Firms’ Value Drivers

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  • Anita KISS

    (Institute of Accounting and Finance, Faculty of Economics and Business, University of Debrecen)

Abstract

This paper focuses on the value creation and the value drivers. One of the objectives of this paper is to present the concept of maximizing shareholder value. The main goal is to categorize the most important value drivers, and their role of the firms’ value. This study proceeds as follows. The first section presents the value chain, the primary and the support activities. The second part describes the theoretical background of maximizing shareholder value. The third part illustrates the key value drivers. The fourth empirical section of the study analyses the database featuring data from 18 European countries, 10 sectors and 1553 firms in the period between 2004 and 2011. Finally, the fifth section includes concluding remarks. Based on the related literature reviewed and in the conducted empirical research it can be assessed that, the EBIT, reinvestment, invested capital, the return on invested capital, the net margin and the sales growth rate all have a positive effect on firm value, while the tax rate and the market value of return on asset (MROA) has a negative one.

Suggested Citation

  • Anita KISS, 2015. "Empirical Analysis Of The Role Of The Firms’ Value Drivers," Network Intelligence Studies, Romanian Foundation for Business Intelligence, Editorial Department, issue 6, pages 91-96, December.
    • Handle: RePEc:cmj:networ:y:2015:i:5:p:91-96
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    References listed on IDEAS

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    1. Harry Markowitz, 1952. "Portfolio Selection," Journal of Finance, American Finance Association, vol. 7(1), pages 77-91, March.
    2. John Lintner, 1965. "Security Prices, Risk, And Maximal Gains From Diversification," Journal of Finance, American Finance Association, vol. 20(4), pages 587-615, December.
    3. William F. Sharpe, 1964. "Capital Asset Prices: A Theory Of Market Equilibrium Under Conditions Of Risk," Journal of Finance, American Finance Association, vol. 19(3), pages 425-442, September.
    4. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
    5. Veronika Fenyves & Tibor Tarnoczi & Zoltan Bacs & Diana Kovacs, 2015. "Comparative Analysis For The Practical Practice Of Cost Calculation," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 976-981, July.
    6. Merton H. Miller & Franco Modigliani, 1961. "Dividend Policy, Growth, and the Valuation of Shares," The Journal of Business, University of Chicago Press, vol. 34, pages 411-411.
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    Citations

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    Cited by:

    1. Kiss Anita, 2017. "An Empirical Analysis Of The Effects Of The 2007-2008 Financial Crisis On Changes In The Value Creation Of Firms In Individual Industrial Sectors," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 405-412, July.
    2. Anita Kiss, 2017. "The Empirical Examination Of Changes Related To Value Drivers In The Effects Of The 2007-2008 Crisis," APSTRACT: Applied Studies in Agribusiness and Commerce, AGRIMBA, vol. 10(4-5), April.

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    More about this item

    Keywords

    Value creation; Shareholder value; Value driver; Firm valuation;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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