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The Impact of Economic Value Added & Return on Investment on the Changes in Stock Market’s Value (Analytical Study: ASE: 2006-2015)

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Listed:
  • Mohammad Al-Afeef

Abstract

This study aims to determine the effect of EVA and ROI and which is better able to explain the change in Stock market’s value in the companies listed in (ASE) (2006-2015), the researcher addresses a random sample consisting of (46) Company, and uses regression model, which connects the dependent and independent variables.The results of the study shows that the return on investment (ROI) is better than (EVA) to interpret the changes in Stock market’s value, where the coefficient of determination (R2) for the ROI is (22.5%), while the R2 for EVA Only 1.3%.This study also recommends the need to look for additional factors that would explain the changes in stock market's value such as- the degree of leverage, systemic risks, and macroeconomic indicators such as- (interest rates and inflation).

Suggested Citation

  • Mohammad Al-Afeef, 2017. "The Impact of Economic Value Added & Return on Investment on the Changes in Stock Market’s Value (Analytical Study: ASE: 2006-2015)," International Journal of Business and Management, Canadian Center of Science and Education, vol. 12(10), pages 132-132, September.
    • Handle: RePEc:ibn:ijbmjn:v:12:y:2017:i:10:p:132
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    References listed on IDEAS

    as
    1. Anas Ali Al-Qudah & Mohammad Abdel Mohsen Al-Afeef, 2015. "The Relationship between the Investment in Current Assets and Profitability & Liquidity," Journal of Finance and Investment Analysis, SCIENPRESS Ltd, vol. 4(4), pages 1-2.
    2. Kenneth Leong & Marco Pagani & Janis K. Zaima, 2009. "Portfolio strategies using EVA, earnings ratio or book‐to‐market," Review of Accounting and Finance, Emerald Group Publishing Limited, vol. 8(1), pages 76-86, February.
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    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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