RT info:eu-repo/semantics/article
T1 Estimation of future levels and changes in profitability: The effect of the relative position of the firm in its industry and the operating-financing disaggregation
T2 Estimación de niveles y cambios de rentabilidad futura: el efecto de la posición relativa de la empresa en su sector y la desagregación de la rentabilidad en operativa y financiera
A1 Amor Tapia, Borja
A1 Tascón Fernández, María Teresa
A2 Economia Financiera y Contabilidad
K1 Contabilidad
K1 Economía
K1 Finanzas
K1 Return on equity
K1 Operating-financing disaggregation
K1 Industry spread
K1 Firm size
K1 Ratio analysis
AB [EN] In this paper we examine how the relative position of a firm’s Return on Equity (ROE) in industries affectsthe predictability of the next-year ROE levels, and the ROE changes from year to year. Using Nissimand Penman breakdown into operating and financing drivers, the significant role of the industry factoris established, although changes in signs suggest subtle non-linear relations in the drivers. Our studyavoids problems originating from negative signs by analyzing sorts and by making new regressions withdisaggregated second-order drivers by signs. This way, our results provide evidence of some differentpatterns in the influence of the first-level drivers of ROE (the operating factor and the financing factor), andthe second-level drivers (profit margin, asset turnover, leverage and return spread) on future profitability,depending on the industry spread. The results on the role of contextual factors to improve the estimationof future profitability remain consistent for small and large firms, although adding some nuances.
PB Elsevier España
SN 1138-4891
LK https://hdl.handle.net/10612/19602
UL https://hdl.handle.net/10612/19602
NO Amor-Tapia, B., y Tascón Fernández, M. T. (2014). Estimation of future levels and changes in profitability: The effect of the relative position of the firm in its industry and the operating-financing disaggregation. Revista de Contabilidad, 17(1), 30–46. https://doi.org/10.1016/J.RCSAR.2013.08.002.
DS BULERIA. Repositorio Institucional de la Universidad de León
RD Jul 11, 2024