Ownership Structure, Firm Value and Investment Opportunities Set: Evidence from Mexican Firms

Martín-Reyna, Juan Manuel San; Durán-Encalada, Jorge A.

doi:10.7341/2012833

Cited by 12 publications

(11 citation statements)

References 51 publications

(92 reference statements)

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“…Firm size determines the financial efficiency of firms and is regarded as one of the key factors affecting firm value (Alonso, Iturriaga and Sanz, 2005). We measure the firm size as the logarithm of firm's assets (Alonso et al, 2005;Martin-Reyna and Durán-Encalada, 2012;Sulong, Gardner, Hussin, Sanusi, and McGowan, 2013). Brian, Philip, Kwaku, and Isabelle (2014) show that managers -owner relationship in large firms would provide negative effect on firm performance.…”

Section: Data and Research Methodsmentioning

confidence: 99%

The Roles of Foreign Ownership and Growth Opportunity amid the Trade War: Evidence from an Emerging Country

AISDL¹

2021

Preprint

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In recent years investors tend to divert their investment to emerging economies in the Association of Southeast Asian Nations (ASEAN), especially during the U.S.-China trade war. The present study adopts the Weighted Least Square (WLS) and PROCESS macro tool to examine the effects of foreign ownership and growth opportunity on financial performance of Vietnamese listed firms over the period 2011-2018. Our findings show that foreign ownership plays as moderator variable in the relationship between short-term and long-term performance of firms. Empirical results also reveal that mediating effects of growth opportunity on short-term and long-term performance are different before and after the trade war. These findings have important implications for investors and managers in the ASEAN countries.

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Section: Data and Research Methodsmentioning

confidence: 99%

The Roles of Foreign Ownership and Growth Opportunity amid the Trade War: Evidence from an Emerging Country

AISDL¹

2021

Preprint

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“…The increase company value is an achievement, as the wishes of the owners, because by the increase company value, the prosperity of the owners will also increase, and this is the duty of the manager as an agent that has been trusted by the company owners to run the company (Riyanto, 2008). The company value is very important because with the high company value, it will be followed by the high prosperity of shareholders (Brigham, Gapenski, & Brigham, 1997;Martin-Reyna & Durán-Encalada, 2012). The higher stock price, the higher company value.…”

Section: Literature Review Company Valuementioning

confidence: 99%

Company Value Improvement Through Funding Policy Based on Ownership Structure (Comparison Study at Conventional and Sharia Manufacturing Companies)

Jumaizi¹,

Ngaijan²

2019

IJIBE

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This research aims to discuss and analyze the influence of ownership structure on the value of the company by dividend policies. The companies analyzed in this research were manufacturing companies listed on Indonesia Stock Exchange (IDX). Data that has been collected is analyzed using Multiple Regression. The results showed that managerial ownership and institutional ownership have a negative and significant impact toward debt policy and company value, while debt policy has a positive and significant impact toward firm value. This phenomenon shows that both shareholders of management and institutional shareholders consider debt policy endanger their position in the company, and will not be materially profitable. Meanwhile, the debt policy is considered as a positive signal of the existence of a business project that the company works on, because the company needs a lot of funds. On the other hand, the ownership composition of shares dominated by management and institutional shareholders is seen as a threat in the community, because there are opportunities to benefit themselves but will not benefit the community. In the end, information asymmetry is still a problem between individual and small shareholders, with shareholders who are able to obtain important company information such as institutional shareholders and shareholders who also control the company's management.

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“…The increase of firm value is not only influenced by internal factors but also external factors (Martín-Reyna, Manuel, & Durán-Encalada, 2012). Internal factors consist of the owner of the company, management capabilities, and the strength of the company's capital.…”

Section: Introductionmentioning

confidence: 99%

“…The owner of the company has an important role in company operations, especially in making policies related to efforts to improve and progress in the future (Frederica, 2019;Sudiani & Wiksuana, 2018). In increasing firm value, management must also plan operations and implement the maximum work plan to achieve the company's goal to get the maximum profit (Martín-Reyna et al, 2012). In increasing firm value, the company not only requires policies that are controlled by the owner and the implementation of planning from management but also must be supported by adequate capital strength (Kumar, Sureka, & Colombage, 2020).…”

Section: Introductionmentioning

confidence: 99%

“…In increasing firm value, the company not only requires policies that are controlled by the owner and the implementation of planning from management but also must be supported by adequate capital strength (Kumar, Sureka, & Colombage, 2020). The external factors include firm size, investment opportunity set, and capital structure influence the firm value as well (Martín-Reyna et al, 2012). Firm size is the scale of the company as measured by the small value of its assets, an investment opportunity set is a group of investments that are combined in the form of fixed assets that are calculated to increase the value of the company (Michalski, 2008), while the capital structure is long-term corporate financing (Eka, 2018;Sudiani & Wiksuana, 2018).…”

Section: Introductionmentioning

confidence: 99%

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The Effect of Firm Size, Investment Opportunity Set, and Capital Structure on Firm Value

Afridi

Khan

Zafar

et al. 2022

International Journal of Social Science Entrepreneurship

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The purpose of this study was to examine how business size, investment opportunity set, and capital structure all affect the value of the company. Explanatory research was conducted for this study, which used secondary data in the form of financial statement data from companies in the banking sector listed on the Pakistani Stock Exchange for the ten years 2010–2019. Twenty-seven businesses were selected for the samples throughout the previous ten years using the purposive sampling technique. The AMOS application and the path analysis approach were both employed in this investigation. The findings of this study revealed that firm size and opportunity to invest set had a significant impact on firm value, whereas capital structure had no impact on firm value. This research suggests that investments, particularly in the banking sector, should have a solid foundation. Additionally, it is essential to evaluate several factors for listed firms, such as the size of the business and the range of investment opportunities, as it has been demonstrated that these factors can greatly increase a company's worth. Because it had no impact on the firm's value, the capital structure should be determined in the interim.

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Ownership Structure, Firm Value and Investment Opportunities Set: Evidence from Mexican Firms

Cited by 12 publications

References 51 publications

The Roles of Foreign Ownership and Growth Opportunity amid the Trade War: Evidence from an Emerging Country

The Roles of Foreign Ownership and Growth Opportunity amid the Trade War: Evidence from an Emerging Country

Company Value Improvement Through Funding Policy Based on Ownership Structure (Comparison Study at Conventional and Sharia Manufacturing Companies)

The Effect of Firm Size, Investment Opportunity Set, and Capital Structure on Firm Value

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