IMPACT OF COMPANY PERFORMANCES ON THE STOCK PRICE: AN EMPIRICAL ANALYSIS ON SELECT COMPANIES IN SERBIA
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.
2. Andžic, S., Rajkovic, M., Ćosic, M. (2016): Nefnansijski aspekti poslovanja kao faktori razvoja preduzetništva, Oditor, Belgrade, Serbia, Vol. 2, No. 2, pp. 7-17.
3. Balakrishnan, K.P. (1984): Determinants of Equity Prices in India, Management Accountant, Vol. 19, No. 12, pp. 728-730
4. Irfan, C.M., Nishat, M. (2002): Key Fundamental Factors and Long-run Price Changes in an Emerging Market – A Case Study of Karachi Stock Exchange (KSE), The Pakisatn Development Review, Vol. 41, No. 4, Part II, pp.517-533
5. Khan, K. I., Aamir, M., Qayyum, A., Nasir, A., Khan, M. I. (2011): Can dividend decisions affect the stock prices: A case of dividend paying companies of KSE. International Research Journal of Finance and Economics, Vol. 76, No. 68, pp. 69-74.
6. Khan, KI. (2012): Effect of Dividends on Stock Prices – A Case of Chemical and Pharmaceutical Industry of Pakistan, Management, Vol. 2, No. 5, pp. 141-148.
7. Khan, M.N. (2012): Determinants of share prices at Karachi stock exchange, International Journal of Business and Management studies, Vol. 4, No. 1, pp. 111-120
8. Kiran,C., Chalam, G.V. (2015): Financial determinants of equity share prices: An empirical analysis study with reference to selected companies listed on Bombay Stock Exchange, International Journal Applied Financial Management Perspectives, Vol. 4, No. 2, pp. 1761-1769
9. Kiran,C., Chalam, G.V. (2015): Equity share price determinants – An empirical analysis (An Empirical Analysis on select Steel Companies in India), Indian Journal of applied research, Vol. 5, No. 1, pp. 79-83
10.Milanovic, N., Andžic, S., Butulija, M. (2017): Struktura kapitala kao determinanta vrednosti preduzeća, Oditor, Belgrade, Serbia, Vol. 3, No. 1, pp. 80-90.
11. MiloševicAvdalovic, S. (2015): Determinante cene akcija na Beogradskoj berzi, Zbornik radova XXI Internacionalni naucni skup SM, Strategijski menadžment i sistemi podrške odlucivanju, 20. maj, Palic, Ekonomski fakultet u Subotici, pp. 133-140.
12.Sharif, T., Purohit, H., Pillai, R. (2015): Analysis of Factors Affecting Share Prices: The Case of Bahrain Stock Exchange, International Journal of Economics and Finance, Vol. 7, No. 3, pp. 207-216
13.Sharma, S. (2011): Determinants of Equity Share Prices in India. Journal of Arts, Science and Commerce, Vol. 2, No. 4, pp.51-60
14.Uddin, R., Rahman, Z., Hossain, R. (2013): Determinants of Stock Prices in Financial Sector Companies in Bangladesh – A Study on Dhaka Sock Exchange (DSE), Interdisciplinary Journal of Contemprorary Research in Business, Vol. 5, No. 3, pp. 471-480
15.Vazakidis, A., Athianos, S. (2010): Do Dividend Announcements Affect The Stock Prices in The Greek Stock Market?, International Journal of Economic Sciences and Applied Research, Vol. 3, No. 2, pp. 57-77
16.Zahir, M.A., Khanna, Y. (1982): Determinants of Stock Prices in India, The Chartered Accountant, Vol. 30, No. 8, pp. 521-523