Fundamentals and Stock Return in Pharmaceutical Companies: a Panel Data Model of Iranian Industry Hydrogel based tablet for vaginal candidiasis
Iranian Journal of Pharmaceutical Sciences,
Vol. 9 No. 1 (2013),
6 February 2024
,
Page 55-60
https://doi.org/10.22037/ijps.v9.40918
Abstract
Stock return is usually considered to be affected by firm’s financial ratios as well as economic variables. Fundamental method assume that stock returns is not solely related to the stock market. Most result come from the company condition, industry situation and whole economy. In this paper, this relationship between stock return and fundamentals is studied using the data for 22 pharmaceutical companies in Tehran Stock Exchange over a 7 year period, and effective factors on stock return are investigated. Because of our data natural we used panel data model from econometric methods.The results show that 80 pecent of change in stock return can be explained with 9 fundamental variables factors including debt-equity ratio, working capital to total asset, current ratio, net profit margin, operating cycle, market share, inflation rate of medicinal products prices, total asset, and exchange rate have significant effect on stock return. This factors can be used in decision making in pharmaceutical industry.
- Economic variables
- Fundamental analysis
- Panel data
- Pharmaceutical companies
- Stock exchange
- Stock return.
How to Cite
References
[2] Thiagarajan R, Lev B. Fundamental information analysis. Journal of Accounting, 1993(31): 190-215.
[3] Piotroski JD.Value Investing:The Use of Historical Financial Statement Information to Separare Winers from Losers. Journal of Accounting Research 2000: 1-41.
[4] Johnson R, Soenen L. Indicator of Successful Company. European Management Journal 2003: 364-369.
[5] Keshavarz K, Kebriaeezadeh A, Hahemi Meshkini A, Nikfar SH, Mirian I, Khoonsari H.Financial perspective of private pharmacies in Tehran(Iran); is it Lucrative business? DARU Journal of Pharmaceutical Scieces 2012: 20,62.
[6] Witkowska M,Fundamental and Stock Returns on the Warsaw Stock Exchange. the Application of Panel Data Models.Department of Applied Economics, Warsaw University Working Papers 2007.
[7] Martani D, KhairurizkaR. The Effect of Finan cial Ratios, Firm Size , and Cash Flow from Oper ating Activities in the Interim Report to the Stock Return. Chinese Business Review 2009: 44-55.
[8] Yahyazadefar M, PournaghshbandH. The Camparison of Methods Artificial Neural Network With Linear Regression Using Specific Variables for Prediction Stock Price in Tehran Stock Exchange. International Journal of Computer Science and Information Security 2010: 38-46.
[9] Fama E, French K. Size and Book-to-Market Factors in Earning and Returns. Jornal of Finance 1995 (50): 131-155.
[10] Drew M. E, Naughton T, Veeraraghavan M. Firm size , Book-to Market Equity and Security Returns: Evidence from the Shanghai Stock Exchange. Australian Journal of Management 2007: 119-140.
[11] Penman S. H, Ou J. A. Financial Statement Analysis and the Prediction ofStock Returns. Journal of Accounting and Economics 1989: 295-329.
[12] Jones C P, Investments: Analysis and Management. North Carolina: Willey, 2007.
[13] Green W.Economometric Analysis.Testing for Unit Root in Heterogeneous Panels. Journal of Econometrics 2003(115): 53-74.
[14] Fisher A. R. (1932). Statistical Methods for Research Workers. Edinburg: Oliver & Boyd, York University, Toronto, Ontario 2005.
[15] Levin A, Lin C.F, Chu C.S. Unit Root Tests in Panel Data: Asymptomatic and Finite-Sample Properties. Journal of Econometrics 2002,(108): 1-24.
[16] Kebriaeezadeh A, Koopaei N N, Abdollahi Asl A, Nikfar S, Mohammadi N, Trend analysis of the pharmaceutical market in Iran ;1997-2010; Policy implications for developping countries. DARU journal of pharmaceutical Sciences 2013: 21(1) : 52.
- Abstract Viewed: 478 times
- IJPS_Volume 9_Issue 1_Pages 55-60 Downloaded: 298 times