Are the Determinants of Young Sme Profitability Different? Empirical Evidence Using Dynamic Estimators

Nunes, Paulo Maçãs; Viveiros, Ana Tereza de Mendonça; Serrasqueiro, Zélia

doi:10.3846/16111699.2011.620148

Cited by 36 publications

(40 citation statements)

References 56 publications

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“…Regarding employment, the results show a positive and significant relationship between EMPLOY and OROA, suggesting that employment contributes to enhancing FF performance, which is in agreement with the results of Lepak et al (2003) and Zhou (2012). This evidence might be associated with better skills to perform the requisite functions and roles in the firm's business activities, contributing to functional flexibility, and consequently, to higher levels of performance (Atkinson, 1984 AGE positively influences performance, which is in accordance with the evidence that older firms are more able to obtain higher levels of performance (Bhaird and Lucey, 2009;Nunes et al (2012).…”

Section: Results Discussionsupporting

confidence: 86%

“…Like previous studies (Bhaird and Lucey, 2009;Nunes et al, 2012), we expect a positive relationship between AGE, calculated as the natural logarithm of the difference between incorporation year and a fiscal year, and firms performance. We consider LEV as the ratio of total debt to total assets (Mishra and McConaughy, 1999;Chen et al, 2010).…”

Section: Variables and Research Modelsupporting

confidence: 75%

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The effect on the performance of listed family and non-family firms

Vieira

2014

Managerial Finance

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Purpose: The purpose of this paper is to examine whether the ownership of public firms is related to accounting and market performance, comparing family and non-family listed firms.Design/methodology/approach: We use regression analysis, considering a sample of Portuguese family and non-family firms for the period between 1999 and 2010.Findings: Overall, the results show that family firms are older, are more indebted and have higher debt costs than non-family firms. However, they present lower levels of risk. The evidence suggests that family firms outperform non-family firms when we consider a market performance measure. The market performance of family-controlled firms is more sensitive to the crisis periods and age, compared to their counterparts. The empirical findings suggest that under economic adversity, the performance is especially compromised by the firms' age. Research limitations/implications:A limitation of this study is the small size of the sample, which derives from the small size of the Portuguese stock market, the Euronext Lisbon.Originality/value: This paper offers some insights on the ownership of public firms and firm performance by investigating a small European economy. The study also contributes to the stream of firm performance, considering new independent variables as determinants of firm performance, such as operational risk. Finally, the study examines the interaction between ownership and performance under both steady and adverse economic conditions, giving the opportunity to analyze whether firm performance differs according to market conditions.

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Section: Results Discussionsupporting

confidence: 86%

Section: Variables and Research Modelsupporting

confidence: 75%

The effect on the performance of listed family and non-family firms

Vieira

2014

Managerial Finance

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“…However, the magnitude of the impact varies between contexts and estimation methods. The positive affect of liquidity level on profitability supports evidence provided by Goddard et al (2005) and Maçãs Nunes et al (2012). The result regarding the positive relationship between firm size and profitability is in line with those of Asimakopoulos et al (2009), Claver et al (2002 and Gschwandtner (2005), but in contrast to those of Dhawan (2001), Goddard et al (2005) and Pi and Timme (1993).…”

Section: The Results Of Ols 2sls Random-effects and Fixed-effects Msupporting

confidence: 84%

“…Access to liquidity is an important precondition for investment and firm profitability (Goddard et al, 2005;Maçãs Nunes et al, 2012). A similar view emphasises the dependence of profitability on resource availability (Yazdanfar, 2013).…”

Section: Selection Of Variablesmentioning

confidence: 99%

The impact of trade credit use on firm profitability: empirical evidence from Sweden

Yazdanfar

2016

Journal of Advances in Management Research

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Purpose – The purpose of this paper is to examine the impact of trade credit as a funding source on profitability among small and medium-sized enterprises (SMEs). Design/methodology/approach – A large cross-sectional panel data set covering 15,897 Swedish SMEs in five industry sectors from 2009 to 2012 was analysed using several statistical techniques. Findings – The study provides empirical evidence that the use of trade credit significantly and negatively affects firm profitability, indicating that SMEs with lower accounts payable are more profitable. Furthermore, liquidity level and firm size are positively related to profitability, while firm age is negatively related to profitability. Practical implications – If firms rely, or are forced to rely, too heavily on accounts payable as a funding source, their long-term profitability could be jeopardized. An efficient financing policy should make the costs related to the use of trade credit more transparent. Thus, firm managers could explicitly use trade credit agreements with their suppliers to control the costs related to this particular financial source. Originality/value – To the authors’ knowledge, this study is the first to focus on the impact of trade credit on profitability in the Swedish context, where SMEs are encouraged to use trade credit as a funding source. In addition, the study is based on an extensive sample of SMEs across several industry sectors.

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“…Several alternative risk factors have consequently been employed in the literature, for example, the size effect of Banz (1981) and Nunes et al (2012). They finds the market value of equity (ME) and firm size provide an explanation of the cross-section of average returns.…”

Section: Introductionmentioning

confidence: 99%

Var and the Cross-Section of Expected Stock Returns: An Emerging Market Evidence

Chen

2014

Journal of Business Economics and Management

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In this paper we investigate the explanatory power of the market beta, firm size, and the book-to-market ratio, as well as Value-at-Risk regarding the cross-sectional expected stock returns in a less developed stock market -Taiwan's stock market. The main purpose is to examine whether the Value-at-Risk factor has marginal explanatory power related to the Fama-French three-factor model. The empirical results show that Value-at-Risk can account for the average stock returns at both 1% and 5% significance levels based on cross-sectional regression analysis. Moreover, from the perspective of the time series regression, the Value-at-Risk factor can also demonstrate the variation of the stock market, especially for the larger companies in the Taiwan stock market.

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Are the Determinants of Young Sme Profitability Different? Empirical Evidence Using Dynamic Estimators

Cited by 36 publications

References 56 publications

The effect on the performance of listed family and non-family firms

The effect on the performance of listed family and non-family firms

The impact of trade credit use on firm profitability: empirical evidence from Sweden

Var and the Cross-Section of Expected Stock Returns: An Emerging Market Evidence

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