Effect of Financial Leverage on the Firm Value of Listed Consumer Goods Firms in Nigeria (Published)
The study investigated the effect of financial leverage on firm values of listed Consumer goods firms in Nigeria. The specific objectives of the study were to examine the effect of debt ratio, debt to equity ratio, interest coverage ratio, debt to EBITDA ratio, and debt to capital ratio (which are proxies for financial leverage) on firm values (proxied by market capitalization) of listed Consumer goods firms in Nigeria. The study adopted ex-post facto research design and secondary data were extracted from the annual reports of sampled Consumer goods firms in Nigeria for the period 2013 – 2022. The panel regression and correlation analysis were used for data analysis. Findings showed that debt ratio has a non-significant negative effect on the market capitalization of Consumer goods firms in Nigeria, Debt to equity ratio has a non-significant negative effect on the market capitalization of Consumer goods firms in Nigeria, interest coverage ratio has a non-significant positive effect on the market capitalization of Consumer goods firms in Nigeria. Debt to EBITDA ratio and Debt to capital ratio have a significant positive effect on the market capitalization of Consumer goods firms in Nigeria. The implication of the findings is that the financial leverage ratios studied have a significant effect on the firm value of the Consumer goods companies in Nigeria. The study concluded that financial leverage ratios have a significant effect on firm value in the sector. The study recommended that firms in the Consumer goods sector should ensure that the proportion of leverage to equity should be properly managed and controlled to prevent the result of diminishing effects on their firm’s value.
Keywords: Capital Structure, Debt Ratio, Financial Leverage, Market Value, Shareholders Wealth, debt to equity ratio, firm valuation.
Corporate Sustainability Disclosures and Market Value of Listed Industrial Goods Firms in Nigeria (Published)
The main objective of this study was to examine the effect of corporate sustainability disclosures on market value of listed industrial goods companies in Nigeria from 2014 to 2023. The independent variable, corporate sustainability disclosure, was proxied by environmental sustainability disclosures, social sustainability disclosures, economic sustainability disclosures and governance sustainability disclosures. The dependent variable of the study was market value measured by market capitalization. The research design adopted for the study was ex post facto, secondary data were employed and purposive sampling technique was adopted to select 11 out of 13 listed industrial goods firms in Nigeria. The ordinary least square regression analysis was used in analysing the data and the statistical package employed was STATA 14.2. The findings of the study revealed that environmental sustainability disclosure has non-statistically significant effect on market value of listed industrial goods companies in Nigeria and social sustainability disclosure has significant positive effect on market capitalization of listed industrial goods companies in Nigeria; Thus, it was concluded that corporate sustainability disclosures have significant effect on market value of listed industrial goods firms in Nigeria. Based on these findings, it was recommended among others that the management of listed industrial goods firms should expand their efforts in social sustainability practices by engaging in community development projects, employee welfare programs, and other socially impactful activities.
Keywords: Market Value, Social Disclosures, market capitalization. Environmental disclosures, sustainability reporting
Effect of Intangible Assets on Market Value of Listed Manufacturing Firms in Nigeria (Published)
The study examined the effect of intangible assets on market value of listed manufacturing firms in Nigeria. The study adopted an Ex-post facto research design. The population of the study comprised of the listed consumer goods companies, listed industrial goods companies, quoted oil and gas firms and the listed healthcare entities in Nigeria from (2013-2023). This study employed analytical software of SPSS and Microsoft excel for the analysis. The secondary data collected were analyzed using descriptive statistics, correlation, and regression analysis. The results of the regression analysis revealed that three major intangible assets- goodwill, software, and research & development (R&D) significantly influenced the market capitalization of the firms. Goodwill had a positive and significant effect on market capitalization, explaining 69.1% of the changes in firm value. This indicated that firms with higher goodwill tend to have higher market capitalization. Software had a negative and significant effect on market capitalization, contributing to a 22.9% decline in firm value. This suggested that higher investment in software could reduce market capitalization, possibly due to maintenance costs or inefficiencies in software utilization. Research and Development (R&D) also had a negative and significant effect, contributing to a 23.8% decrease in market capitalization. It was thus concluded that intangible assets have significant effect on market value of listed manufacturing firms in Nigeria. The recommendations made included that firms should focus on projects that have clear market potential and can generate immediate value.
Keywords: Intangible Assets, Market Capitalization, Market Value, Research and Development, Software, goodwill
Asset Valuation and Firm Capitalization of Consumer Goods Manufacturing Companies Quoted in Nigeria (Published)
Capitalization enables firms from around the world to be able to evaluate how effective the investments of any company are thus making it an important variable to be considered when making an investment decision. To ascertain a firm’s market value or capitalization, assets need to be valued among other measures that need to be undertaken. Thus necessitating this research work on Asset Valuation and Firm Capitalization of Consumer Goods Manufacturing Companies Quoted in Nigeria. For this study, the adopted research design was Ex-post facto. The study’s main objective was to investigate asset valuation’s effect on Consumer Goods Manufacturing Companies’ capitalization. The study’s population is 52 manufacturing companies as quoted on the Nigeria Stock Exchange as of 31st December 2020 out of which 12 were purposively selected. Audited annual reports of the companies that were sampled formed the source of Data collected for this study for a period of 10 years (2011 – 2020). Data for this study were analyzed with the aid of descriptive and inferential statistics and the outcome showed that asset valuation significantly affects firm capitalization. This is seen in the Adj.R2 = 0.312126 and F-Statistics = 26.41023 and P-value of 0.000000 values. The conclusion of this study thus is that asset valuation has a significant effect on firm capitalization Consumer Goods Manufacturing Companies Quoted in Nigeria. The study recommended that firm Managers should give due attention to asset management and valuation to ensure a positive and significant impact on firm capitalization while investors are advised to ensure that the assets of a firm are properly valued to ensure fair firm capitalization before embarking on investment commitment.
Keywords: Investment Decision, Market Value, asset valuation, consumer goods, firm capitalization
The Strategic Perspective of Intellectual Capital Accounting and Increased Market Value to Business Organizations in the Knowledge Society (Published)
The importance of this study status enjoyed by the accountant in creating additional positive flows directly, and indirect contribution in rising in the capital markets through the creation of an enabling environment capable of overcoming the problems facing professional activities and services for accountants and insurance company and shareholder requirements efficiently and effectively. This development led to a change in the Outlook for accounting work which was considered a service center because it was limited to logging operations and Fund, and with modern developments have changed the perception of the accounting strategy as a profit center and Given to the accountant of suggestions for alternatives to investment and finance operations and undermine the risk gap as a missed in negotiating with all parties, such as optimization of the advertising side of accounting resulting creation flows additional profit and effective contribution in shaping strategic plans which reflect positively on the market capitalization of the business. The main results of the researcher are: The changing perception of intellectual capital accounting strategic axis produce about profits and flows and actual additions contribute to increasing the market value of the business, and this changed perception of accounting service center to profit center. Successful organizations are able to address the gaps and shortcomings in the efficiency of the accounting staff and see how willing those cadres to deal with sophisticated technologies.
Keywords: Business Organizations, Information Technology, Intellectual Capital, Market Value