Performance measures: traditional accounting measures vs. modern value-based measures. The case of earnings and EVA ® in the Athens Stock Exchange (ASE)

Dimitrios I. Maditinos, Zeljko Sevic and Nikolaos G. Theriou

International Journal of Economic Policy in Emerging Economies, 2009, vol. 2, issue 4, 323-334

Abstract: This study is stimulated by both the EVA ^® proponents' assertions and by the mixed empirical results for its value relevance reported until now. Pooled time-series, cross sectional data of listed companies in the Athens Stock Exchange (ASE) over the period 1992-2001 have been employed to examine whether EVA ^® or the traditional accounting-based measures are associated more strongly with stock returns. Relative information content tests reveal that stock returns are more closely associated with earnings per share than with EVA ^®. However, incremental information content tests suggest that EVA ^® adds considerable explanatory power to earnings per share.

Keywords: traditional accounting performance measures; EPS; ROI; ROE; modern value based performance measures; EVA; economic value added; SVA; shareholder value added; ASE; Athens Stock Exchange; Greece; stock returns; earnings per share. (search for similar items in EconPapers)
Date: 2009
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