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The Impact of Profitability on Market Value Added: Evidence from Turkish Informatics and Technology Firms

Author

Listed:
  • Ali Ihsan Akgun

    (Ankara Y ld r m Beyaz t University, Business School, Ankara, Turkey,)

  • Famil Samiloglu

    (Department of Business Administration, Faculty of Economics and Administrative Sciences, Mu la S tk Ko man University, Mu la, Turkey,)

  • Ali Osman Oztop

    (Department of Economics and Finance, Business School, Mu la S tk Ko man University, Mu la, Turkey)

Abstract

The purpose of this study is to examine empirically the relationship between economic value added (EVA), return on assets (ROA), and return on equity (ROE) with market value added (MVA) in Istanbul Stock Exchange (BIST). This study also examine the performances implemented by Turkish Informatics and Technology Firms during the global financial crisis of 2008-2009. Using the experimental data were drawn from a panel consisting of 13 Turkey firms listed in the BIST, from informatics and technology companies, observed over the ten-year period. Multicollinearity various regression models were examined in order to test the hypotheses included in the examined literature. In the research methodology such as fixed effects and random effects were examined in order to test our hypotheses proposed. Finally, evidence is presented that economic value added has a negative and significant relationship with MVA, while ROA and ROE have no significant relationship with MVA in the long-term.

Suggested Citation

  • Ali Ihsan Akgun & Famil Samiloglu & Ali Osman Oztop, 2018. "The Impact of Profitability on Market Value Added: Evidence from Turkish Informatics and Technology Firms," International Journal of Economics and Financial Issues, Econjournals, vol. 8(4), pages 105-112.
    • Handle: RePEc:eco:journ1:2018-04-13
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    References listed on IDEAS

    as
    1. Allen N. Berger & Leora F. Klapper & Rima Turk-Ariss, 2017. "Bank competition and financial stability," Chapters, in: Jacob A. Bikker & Laura Spierdijk (ed.), Handbook of Competition in Banking and Finance, chapter 10, pages 185-204, Edward Elgar Publishing.
    2. Beck, Thorsten & De Jonghe, Olivier & Schepens, Glenn, 2013. "Bank competition and stability: Cross-country heterogeneity," Journal of Financial Intermediation, Elsevier, vol. 22(2), pages 218-244.
    3. Cipollini, Andrea & Fiordelisi, Franco, 2012. "Economic value, competition and financial distress in the European banking system," Journal of Banking & Finance, Elsevier, vol. 36(11), pages 3101-3109.
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    5. Erik Brynjolfsson & Lorin M. Hitt, 2000. "Beyond Computation: Information Technology, Organizational Transformation and Business Performance," Journal of Economic Perspectives, American Economic Association, vol. 14(4), pages 23-48, Fall.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Market Value Added; Economic Value Added; Financial Crisis; Return on Asset; Return on Equity.;
    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
    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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