An analysis of the variables affecting the share price performance of unrelated companies

Abstract :

Investigates the relationship between the Share Price Premium as a measure of performance and internal measures of financial risk, return, and growth over the five year period, 1980-1984, for industrial Unrelated Passive businesses quoted on the Johannesburg Stock Exchange. The purpose of this investigation is to identify which of the above factors have a significant impact on the Share Price Premium, to show in what ways these variables and their influence on the Share Price Premium (SPPM) differ from those for single businesses, and to establish the nature of the impact produced by the financial risk, return and growth factors on SPPM. Findings of this report could contribute to management involved in the process of strategic planning to exercise a better degree of control over the performance of their businesses, thus increasing shareholder wealth. The methods used in this research were statistical methods of correlation and regression. This research confirms earlier findings that Unrelated Passive businesses are relatively poor performers, with poor rates of return, and higher financial risk than single firms. Measures of financial risk were found to be the most important individual factors affecting the performance of Unrelated Passive businesses. Return and growth were also found to produce a significant effect on the share performance of Unrelated Passive businesses. It was found, in addition, that the stock market was concerned with combined effect of financial risk, return and growth factors to a similar degree. These factors explained less than 50% of the Share Price Premium, suggesting that it would be necessary to research additional factors in order to explain the behaviour of SPPM for Unrelated Passive Businesses to a fuller extent.

 

Details

Author Oren I
URL http://hdl.handle.net/20.500.11892/117300
Date Accessioned 2016-09-22T11:23:34Z
Date Available 2016-09-22T11:23:34Z
Date Created
Identifier URL 1986
Language English
Subject Business administration / Business leadership
Subject 2 Business administration / Business leadership
Alternative Title
Degree Type Masters degree
Degree Description  MBA