CAPITAL GAIN PREDICTABILITY USING FINANCIAL RATIOS: A CASE STUDY OFAGRIBUSINESS STOCKS

The financial ratios are the key indicators to assess the strength and weaknesses of company performance. In the stock market, capital gain plays a pivotal role to attract investors in the value of a firm’s stock investment, while the stock of agribusiness firms becomes a potential outlook to be inv...

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Autor principal:	Ilmas Abdurofi
Formato:	article
Lenguaje:	EN TR
Publicado:	International Journal of Food and Agricultural Economics 2021
Materias:	agro-industrial sector capital market econometrics Agriculture S
Acceso en línea:	https://doaj.org/article/9785768be6aa455e9095cc0a59eb01d2
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spelling	oai:doaj.org-article:9785768be6aa455e9095cc0a59eb01d22021-11-29T11:13:01ZCAPITAL GAIN PREDICTABILITY USING FINANCIAL RATIOS: A CASE STUDY OFAGRIBUSINESS STOCKS2147-8988https://doaj.org/article/9785768be6aa455e9095cc0a59eb01d22021-10-01T00:00:00Zhttps://www.foodandagriculturejournal.com/vol9.no4.pp287.pdfhttps://doaj.org/toc/2147-8988The financial ratios are the key indicators to assess the strength and weaknesses of company performance. In the stock market, capital gain plays a pivotal role to attract investors in the value of a firm’s stock investment, while the stock of agribusiness firms becomes a potential outlook to be investigated. The study aims to describe the predictability of capital gain by using financial ratios, namely dividend yield (DY), earnings yield (EY), a book to market (BM), debt-equity ratio (DER), and return on asset (ROA). The panel data model, generalized least square, ordinary least square, is applied to estimate the predictive regression both in separated and combined models. The result discloses that the majority of individual financial ratios can predict future capital gain on agribusiness stock except for the debt-equity ratio (DER). While the book to market value (BM) has the highest predictive power among other variables. Moreover, the predictability of capital gain is considerably enhanced by applying the combination of financial ratios.Ilmas AbdurofiInternational Journal of Food and Agricultural Economicsarticleagro-industrial sectorcapital marketeconometricsAgricultureSENTRInternational Journal of Food and Agricultural Economics, Vol 9, Iss 4, Pp 287-295 (2021)
institution	DOAJ
collection	DOAJ
language	EN TR
topic	agro-industrial sector capital market econometrics Agriculture S
spellingShingle	agro-industrial sector capital market econometrics Agriculture S Ilmas Abdurofi CAPITAL GAIN PREDICTABILITY USING FINANCIAL RATIOS: A CASE STUDY OFAGRIBUSINESS STOCKS
description	The financial ratios are the key indicators to assess the strength and weaknesses of company performance. In the stock market, capital gain plays a pivotal role to attract investors in the value of a firm’s stock investment, while the stock of agribusiness firms becomes a potential outlook to be investigated. The study aims to describe the predictability of capital gain by using financial ratios, namely dividend yield (DY), earnings yield (EY), a book to market (BM), debt-equity ratio (DER), and return on asset (ROA). The panel data model, generalized least square, ordinary least square, is applied to estimate the predictive regression both in separated and combined models. The result discloses that the majority of individual financial ratios can predict future capital gain on agribusiness stock except for the debt-equity ratio (DER). While the book to market value (BM) has the highest predictive power among other variables. Moreover, the predictability of capital gain is considerably enhanced by applying the combination of financial ratios.
format	article
author	Ilmas Abdurofi
author_facet	Ilmas Abdurofi
author_sort	Ilmas Abdurofi
title	CAPITAL GAIN PREDICTABILITY USING FINANCIAL RATIOS: A CASE STUDY OFAGRIBUSINESS STOCKS
title_short	CAPITAL GAIN PREDICTABILITY USING FINANCIAL RATIOS: A CASE STUDY OFAGRIBUSINESS STOCKS
title_full	CAPITAL GAIN PREDICTABILITY USING FINANCIAL RATIOS: A CASE STUDY OFAGRIBUSINESS STOCKS
title_fullStr	CAPITAL GAIN PREDICTABILITY USING FINANCIAL RATIOS: A CASE STUDY OFAGRIBUSINESS STOCKS
title_full_unstemmed	CAPITAL GAIN PREDICTABILITY USING FINANCIAL RATIOS: A CASE STUDY OFAGRIBUSINESS STOCKS
title_sort	capital gain predictability using financial ratios: a case study ofagribusiness stocks
publisher	International Journal of Food and Agricultural Economics
publishDate	2021
url	https://doaj.org/article/9785768be6aa455e9095cc0a59eb01d2
work_keys_str_mv	AT ilmasabdurofi capitalgainpredictabilityusingfinancialratiosacasestudyofagribusinessstocks
_version_	1718407415720837120

CAPITAL GAIN PREDICTABILITY USING FINANCIAL RATIOS: A CASE STUDY OFAGRIBUSINESS STOCKS

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