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Determinants of telecommunication stock prices

Author

Listed:
  • Andros Gregoriou
  • Jerome Healy
  • Jairaj Gupta

Abstract

Purpose - – The purpose of this paper is to analyze the determinants affecting the stock prices of telecommunications firms in both developed and developing countries around the world. Design/methodology/approach - – The empirical analysis is performed using panel data from 160 countries and 45 companies, covering the time period from 2000 to 2011. To identify the significant factors, company level firm-specific financial and non-financial factors have been analyzed that are expected to bear significant impact on price volatility of telecommunications stock. Findings - – The test results reveal that capital expenditure and book value are the most significant factors. Dividends and debt levels only affect prices significantly in specification tests with either time-series or cross-sectional effects, whereas firms’ earnings and numbers of mobile internet subscribers do not contribute to the explanatory power of telecommunication stock price variability. Practical implications - – The study sheds light to the potential investors in evaluating the risk associated with investment in stocks of telecommunications firms and take informed investment decisions. Originality/value - – This is the first study that presents a comprehensive analysis of determinants affecting the stock prices of telecommunications firms in both developed and developing countries around the world.

Suggested Citation

  • Andros Gregoriou & Jerome Healy & Jairaj Gupta, 2015. "Determinants of telecommunication stock prices," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 42(4), pages 534-548, September.
    • Handle: RePEc:eme:jespps:v:42:y:2015:i:4:p:534-548
    DOI: 10.1108/JES-06-2013-0080
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    Citations

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    Cited by:

    1. Arif SALDANLI & Mücahit AYDIN & Hakan BEKTAŞ, 2017. "The determinants of stock prices: Evidence from the Turkish banking sector," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(1(610), S), pages 181-188, Spring.
    2. Arif SALDANLI & Mücahit AYDIN & Hakan BEKTAŞ, 2017. "The determinants of stock prices: Evidence from the Turkish banking sector," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(1(610), S), pages 181-188, Spring.

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