A study on relationship between investment opportunities and earnings: A corporate life cycle investigation

Management Science Letters

关键词: Investment opportunities;    Earnings response coefficient;    Life cycle;   

DOI  :  10.5267/j.msl.2013.06.017

来源: DOAJ

【 摘 要 】

Intrinsic value of a firm depends on its financial and investing decisions. Market reacts differently to firms with different level of investment opportunities. A firm’s age and current stage of life cycle affect its future investment opportunities. Examining a sample of Tehran Stock Exchange for the period of 2006-2010, this study examines the relationship between investment opportunities and earnings according to corporate life cycle. Results suggest a significant association between investing activities and earnings response coefficient. Additionally, the results indicate that the explanatory power of the relationship between investment opportunities and earnings varies by corporate life cycle. Growth firms indicate stronger relation than decline firms do.

【 授权许可】

Unknown