Shareholder Value Creation at Excessive Growth Levels: Empirical Evidence from Turkey

Levent Ataünal and Ali Osman Gürbüz
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Levent Ataünal: İstanbul Aydın University
Ali Osman Gürbüz: Istanbul Coomerce University

Journal of Finance Letters (Maliye ve Finans Yazıları), 2016, vol. 31, issue 106, 9-28

Abstract: In this study, to determine value creation rates at high and moderate growth levels, 8 years data of 167 non-financial com¬panies of Borsa Istanbul is employed in a panel data analysis. The study found that growing significantly above sustainable growth rate is systematically associated with value destruction. It is also demonstrated that shareholder return is a concave function of firm growth, proposing an optimal point of sales growth beyond which further growth destroys shareholder value.

Keywords: Value Creation; Firm Growth; Sustainable Growth Rate; Sales growth (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:acc:malfin:v:31:y:2016:i:106:p:9-28

DOI: 10.33203/mfy.312265

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