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The impact of working capital optimization on the value of the company - part 1
[Vliv optimalizace pracovního kapitálu na hodnotu podniku - část 1 empirické studie]

Author

Listed:
  • Barbora Rýdlová
  • Ivana Svatová

Abstract

The article analyzes the relationship between working capital, as one of the value drivers, and the value of the company. It focuses on the synthesis of the conclusions of empirical studies of the relationship between working capital and various corporate indicators, such as profit, profitability, but also, for example, corporate indebtedness. The subject of research is also the relationship between working capital and industry and working capital and the size of the company. The relationship between the volume of working capital and the need for investment (existence of investment opportunities) also proves to be significant. The results of domestic and foreign studies from recent years are synthesized. The article can serve financial managers for a more comprehensive understanding of the management of working capital - ie how it impacts the growth and performance of the company. However, it is also intended for valuation professionals for the purpose of preparing the business plan for the DCF method.

Suggested Citation

  • Barbora Rýdlová & Ivana Svatová, 2020. "The impact of working capital optimization on the value of the company - part 1 [Vliv optimalizace pracovního kapitálu na hodnotu podniku - část 1 empirické studie]," Oceňování, Prague University of Economics and Business, vol. 13(3-4), pages 37-50.
    • Handle: RePEc:prg:jnloce:v:13:y:2020:i:3-4:id:2020_3_04:p:37-50
    DOI: 10.18267/j.ocenovani.253
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    References listed on IDEAS

    as
    1. Tamer Bahjat Sabri, 2012. "The impact of working capital on the value of the company in light of differing size, growth, and debt," Business and Economic Horizons (BEH), Prague Development Center, vol. 7(1), pages 27-41, June.
    2. Aktas, Nihat & Croci, Ettore & Petmezas, Dimitris, 2015. "Is working capital management value-enhancing? Evidence from firm performance and investments," Journal of Corporate Finance, Elsevier, vol. 30(C), pages 98-113.
    3. Sabri, Tamer Bahjat, 2012. "The impact of working capital on the value of the company in light of differing size, growth, and debt," Business and Economic Horizons (BEH), Prague Development Center (PRADEC), vol. 7(1), pages 1-15, June.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Working Capital; Market value; Valuation; Pracovní kapitál; Tržní hodnota; Oceňování;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General

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