The Liquidity Crisis: Evidence from the US Hospitality Industry

Dewally, Michaël; Shao, Yingying; Singer, Dan

doi:10.5367/te.2013.0214

Cited by 21 publications

(12 citation statements)

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“…Although capital structure determinants are well documented, there are few articles about the capital structure of firms in the hospitality industry. Some exceptions are Dalbor and Upneja (2002, 2004); Devesa and Esteban (2011); Dewally et al (2013); Farcnik et al (2015); Karadeniz et al (2009); Kim (1997); Lee and Dalbor (2013); Madan (2007); Sheel (1994); Such et al (2009); Upneja and Dalbor (2001). Sheel (1994) examines the potential determinants of debt used by hotel and manufacturing firms.…”

Section: Relative Importance Of Smesmentioning

confidence: 99%

Capital structure determinants of hospitality sector SMEs

Pacheco

Tavares

2016

Tourism Economics

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The main objective of this paper is to study the capital structure determinants of SMEs in the hospitality sector and how this can influence their level of indebtedness. Using panel data methodology and considering a sample of 43 Portuguese hotels we study the capital structure determinants between 2004 and 2013. The paper intends to examine the indebtedness level in light of the two main theories -the Trade-off theory and the Pecking Order theory. We chose the hospitality sector because of its importance in the Portuguese economy and because this particular sector has hardly been studied. In addition to total indebtedness, we extend the literature by analyzing the differences between short-term and long-term indebtedness. The results obtained suggest that profitability, assets tangibility, firm dimension, total liquidity and risk are key factors affecting the capital structure of hospitality sector SMEs, while growth, other tax benefits and age were not deemed relevant. These results allow us to conclude that Trade-off and Pecking Order theories should not be considered in isolation to explain the capital structure of hospitality sector SMEs.

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Section: Relative Importance Of Smesmentioning

confidence: 99%

Capital structure determinants of hospitality sector SMEs

Pacheco

Tavares

2016

Tourism Economics

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“…Kim and Gu (2009) study the financial features of dividend-paying companies in the US hospitality industry. Dewally et al (2013) examine the stock performance of companies in the US hospitality sector.…”

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confidence: 99%

Dividend payouts of travel and leisure companies in Western Europe

Bahreini

Adaoglu

2018

Tourism Economics

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This study examines the dividend payout determinants of travel and leisure companies in five Western European countries that are ranked among the world’s top 10 tourist destinations, namely, France, Spain, Italy, Germany, and the United Kingdom. The study analyzes the sector and carries out a comparative analysis of the subsectors. Panel data random-effects Tobit estimation methodology is used during a 10-year period (2005–2015). In addition to the traditional dividend determinants, sector and country-specific determinants such as leverage, asset intangibility, capital intensity (CI), and effective dividend tax rate are used. The estimation results demonstrate that company size, profitability, investment opportunities, and asset intangibility are positive drivers of dividend payout, whereas the leverage ratio and CI deter dividend payout. Additionally, the study provides international empirical evidence for the positive relationship between investment opportunities and dividend payout. This positive relationship, which is regarded as a puzzle, is unique for companies operating in the travel and leisure sector. The identification of unique dividend determinants and the recognition of differences among the subsectors help investors and managers to shape their investment and financial management decisions.

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“…First, we restrict our sample time period to the period extending from 1990 to 2007 so as to not include the recent liquidity crisis. The liquidity crisis disrupted the economic cycle so deeply that it impacted firms' capital structure and investment decisions in the hospitality sector (Dewally et al, 2013). Given that bank capital dried up during the crisis period and that consumer spending spiralled down in the United States, the driving characteristics of large investments were dramatically affected.…”

Section: Data and Sample Descriptionmentioning

confidence: 99%

Determinants of financial policy in the hospitality sector in the United States

2015

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This article investigates the circumstances surrounding large investments by firms in the hospitality sector in the United States. The authors identify 400 large-scale investment events for firms in the restaurant, hotel, and recreation industries. During these events, firms increase their size substantially through building or acquiring assets. The authors determine that a combination of market and firm-specific factors lead to such events. Firms are more likely to engage in large investments when they have experienced strong recent sales growth and when they have lower existing leverage. These investments are more likely when the market is less volatile and when general economic conditions indicate strong consumer demand. Finally, the authors show that firms are more likely to rely on a combination of cash flow and debt financing to complete such investments, though firms experiencing higher sales growth are prone to use more equity financing.

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The Liquidity Crisis: Evidence from the US Hospitality Industry

Cited by 21 publications

References 50 publications

Capital structure determinants of hospitality sector SMEs

Capital structure determinants of hospitality sector SMEs

Dividend payouts of travel and leisure companies in Western Europe

Determinants of financial policy in the hospitality sector in the United States

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