IMPACT OF COMPANY PERFORMANCES ON THE STOCK PRICE: AN EMPIRICAL ANALYSIS ON SELECT COMPANIES IN SERBIA

  • Snežana Miloševic Avdalovic, PhD University of Novi Sad, Faculty of Economics Subotica
  • Ivan Milenković, PhD University of Novi Sad, Faculty of Economics Subotica

Abstract

The global fnancial crisis of the late 2007 has provoked unprecedented shocks to the world markets and weaken investors’ confdence due to the turbulent movements and frequent changes of stock prices. Emerging capital markets suffer from unsatisfactory corporate governance, market manipulation and insider trade problems. In such circumstances, institutional investors, managers, analysts and other market participants are in constant search of the trading strategy that will outperform the market. This research is an instrument for the identifcation of the main determinants of stock prices on the Belgrade Stock Exchange. The panel data regression analysis includes 42 companies that represent the composition of the BelexLine index for the period from 2010 to 2014. The paper looks at the impact of specifc (internal) variables of companies, such as company size, return on assets, return on equity, earnings per stock, book value, price-earning ratio, price-to-book ratio and leverage and the stock price of companies that compose the BelexLine index. The results indicate that variables such as the size of the company measured by assets, return on assets, leverage, earnings per stock, book value and price-to-book ratio provide a unique contribution to a statistically signifcant predictor of stock prices.

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Published
2017-06-30
How to Cite
MILOŠEVIC AVDALOVIC, Snežana; MILENKOVIĆ, Ivan. IMPACT OF COMPANY PERFORMANCES ON THE STOCK PRICE: AN EMPIRICAL ANALYSIS ON SELECT COMPANIES IN SERBIA. Economics of Agriculture, [S.l.], v. 64, n. 2, p. 561-570, june 2017. ISSN 2334-8453. Available at: <http://ea.bg.ac.rs/index.php/EA/article/view/105>. Date accessed: 24 oct. 2020. doi: https://doi.org/10.5937/ekoPolj1702561M.
Section
Original scientific papers

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