The Influence of Economic Value Added and Return on Assets on Created Shareholders Value: A Comparative Study in Jordanian Public Industrial Firms

Sliman S. Alsoboa

International Journal of Economics and Finance, 2017, vol. 9, issue 4, 63-78

Abstract: This study has two main objectives. The first one is to address the relationship between Economic Value Added (EVA) and Created Shareholders Value (CSV) in Jordanian public industrial firms (JPIF), comparing to the Return on Assets (ROA) over the period 2011-2015. The second objective is to address the possible superiority of EVA to ROA by explaining the changes in CSV for JPIF. In this study, CSV is measured using two models; Fernandez model and market value added model. Multiple and simple regressions were used in the study. These analyses have shown, generally, that the superiority of EVA in predicting and evaluating the CSV could be put into a conclusive and positive light compared to ROA. However, the results suggested that one financial measure cannot be enough to measure neither CSV nor firms¡¯ performance. Therefore, this study highly recommends that JPIF use a combination of different measure in assessing and evaluating their value and performance, especially modern indicators.

Keywords: economic value added; return on assets; created shareholders value; market value added; Fernandez model; Jordan (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://ccsenet.org/journal/index.php/ijef/article/view/65866/36301 (application/pdf)
http://ccsenet.org/journal/index.php/ijef/article/view/65866 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ibn:ijefaa:v:9:y:2017:i:4:p:63-78

Access Statistics for this article

More articles in International Journal of Economics and Finance from Canadian Center of Science and Education Contact information at EDIRC.
Bibliographic data for series maintained by Canadian Center of Science and Education ().