Microeconomic factors affecting financial performance of Romanian companies listed on Bucharest Stock Exchange

Lavinia Mihaela Guţu
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Lavinia Mihaela Guţu: Bucharest University of Economic Studies, Romania

Theoretical and Applied Economics, 2015, vol. XXII, issue Special(II), 71-79

Abstract: The financial performance is a desirable matter for any company and, therefore, it is imperative to understand its behavior and the factors that make it to be better or worse. Having this issue in view, this paper is analyzing the microeconomic factors which affect a firm’s financial results. The study is focusing on 15 companies from different economic sectors listed on Bucharest Stock Exchange for the period between 2003 and 2013. The dependent variable used to measure performance is return on assets and the independent variables are firm’s size, firm’s age, debts to assets ratio, accounts receivable, financial leverage and net result. Model estimations leads to the conclusion that firm’s age and net results affect positively the financial performance, firm’s size and debts to assets ratio affect negatively the dependent variable, while accounts receivable and financial leverage have no significant impact on return on assets. However, further investigation is needed in order to find some other microeconomic factors that influence financial performance.

Keywords: financial performance; return on assets; microeconomic factors; firm’s size; firm’s age. (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:agr:journl:v:xxii:y:2015:i:special(ii):p:71-79

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