Indicators of Successful Companies

Johnson, Robert R.; Soenen, Luc

doi:10.1016/s0263-2373(03)00050-1

Cited by 83 publications

(64 citation statements)

References 22 publications

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“…Growth in sales is used as growth rate in this study. Among studies that used company's growth as a proxy for performance measures include Dess and Davies (1986), Lee et al (1990) and Johnson and Soenen (2003). Dess and Davies (1986) carried out a study on the determinants of strategic group membership and organizational performance of U. S. firms.…”

Section: Other Company Attributesmentioning

confidence: 99%

Comparative Study on Performance Measures and Attributes between ISO and Non-ISO Certification Companies

Mokhtar

Muda

2012

IJBM

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This study surveys a sample of 162 public listed companies on the Kuala Lumpur Stock Exchange. The study utilises eight different measures of company performance, ROA, ROE, WC, ROS, CF, TQ and EVA, and five company's attributes, namely size, growth. capital structure, age and industrial category. The analyses revealed that ISO registered Malaysian companies outperformed their non-ISO registered counterparts during the period of this study. This study finds that ISO 9000 registered companies in Malaysia are better off than non-ISO 9000 registered companies in terms of performance measures ROA, ROS and WC, except for EVA. ISO 9000 registered companies are younger, larger, and have a higher growth and a lower capital structure than non-ISO 9000 registered companies.

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Section: Other Company Attributesmentioning

confidence: 99%

Comparative Study on Performance Measures and Attributes between ISO and Non-ISO Certification Companies

Mokhtar

Muda

2012

IJBM

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“…EVAä is regarded as a single, simple measure that gives a real picture of stockholder wealth creation (Tully, 1998). Johnson and Soenen (2003) formulated that one of the benefits of EVA is its simplicity and its easiness to adjust for risk.…”

Section: Economic Value Added (Eva)mentioning

confidence: 99%

Economic value added (eva) as a performance measurement for glcs vs non-glcs: evidence from bursa malaysia

Ismail¹,

Fazilah²,

Hwa³

et al. 2008

Prague Economic Papers

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Ab stract:EVA is a use ful tool for as sess ing com pany per for mance. It com bines fac tors, such as econ omy, ac count ing and mar ket in for ma tion in its as sess ment. This study em ployed EVA in an at tempt to com pare the com pa nies' per for mances of GLCs (gov ern ment-linked com pa nies) and non-GLCs. Based on a 4-year pooled panel data of 37 GLCs and 208 non-GLCs, the re sults show that com pa nies with gov ern ment as their stake holders tend to ex hibit lower EVA scores than the com pa nies with out gov ern ment stake holders in Ma lay sia. Larger size com pa nies were found to have lower EVA val ues. Com pa nies which have both the char ac ter is tics -which are si mul ta neously large in size and gov ern ment-owned, tend to be most ad versely af fected. Thus, any in cre ment in the size of com pany for GLCs would de crease or de stroy the value of the com pany, and to a greater degree, than companies without government holding.

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“…In particular, further studies are suggested to consider these assumptions: (a) benchmark the indicators with those companies without acquisition/merger, to identity if the improvement over time is significantly out-performed or not, and (b) consider risk-adjusted performance indicators to reflect a more holistic view of risk before and after merger. Bhattacharyya (2011), Johnson andSoenen (2003), Kumar and Suhas (2010), and Mantravadi and Reddy (2008). Note: (a) Tobin's q ratio is not used as a variable while computing cylinder models, but it is being used to test general hypotheses, simply as an accounting ratio.…”

Section: Discussionmentioning

confidence: 99%

Corporate mergers and financial performance: a new assessment of Indian cases

Reddy

Nangia

Agrawal

2013

Nankai Business Review International

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PurposeIt is worth mentioning that mergers and acquisitions (M&As) have become a popular vehicle for emerging‐markets firms to rapidly access new opportunities and market capabilities. Indeed, privatization and multi‐nationalization have given a greater shore up in raising global and domestic merger deals. Motivated by these factors, the purpose of this paper is to investigate “do mergers produce abnormal returns around the announcement; conversely, do they improve financial performance in the long‐run?”Design/methodology/approachThe study applies earnings management approach (event study) to compute average abnormal returns (AAR) around the merger announcement for select Indian M&A cases. Further, accounting ratios are considered to assess the long‐run financial performance. Thereafter, t‐stat is applied for testing the proposed hypotheses. In particular, it has performed a later test to the means of financial ratios and variables for both services and manufacturing sectors in accounting ratios and cylinder models, respectively.FindingsThe select Indian M&A cases show superior performance during the post‐merger period for both manufacturing and services sectors, and observe a balance sheet improvement in the long‐run.Research limitations/implicationsSample is one of the limitations to the study. Due to small sample of merger cases, this paper has limited scope to generalize the results. Hence, academic researchers may employ the suggested assessment (cylinder)‐models on a large sample.Practical implicationsThe research work would help financial analysts, stockbrokers, M&A advisory and regulatory bodies while designing takeover and open offer policies.Originality/valueThis is an original contribution, which has developed new assessment (cylinder)‐models to examine the post‐merger long‐run financial performance of acquiring firms, especially sector‐wise evaluation.

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Indicators of Successful Companies

Cited by 83 publications

References 22 publications

Comparative Study on Performance Measures and Attributes between ISO and Non-ISO Certification Companies

Comparative Study on Performance Measures and Attributes between ISO and Non-ISO Certification Companies

Economic value added (eva) as a performance measurement for glcs vs non-glcs: evidence from bursa malaysia

Corporate mergers and financial performance: a new assessment of Indian cases

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