The relationship of financial performance and stock returns in countries under economic sanctions

Ali Akbar Gholizadeh, Davood Jafari Seresht, Zahra Bayat and Leyla Jabari
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Ali Akbar Gholizadeh: Bu Ali Sina University
Davood Jafari Seresht: Bu Ali Sina University
Leyla Jabari: Bu Ali Sina University

Journal of Asset Management, 2023, vol. 24, issue 1, No 2, 16-26

Abstract: Abstract Accounting and economic evaluation criteria play an important role in assessing the performance of the firms. Choosing proper criteria for such evaluation has been reported in reviews of literature on financial management. The present study aims to find the relationship between economic value added (EVA) as the criterion for evaluating economic performance, and return on assets and stock returns as indicators of economic accomplishment. For this, our statistical community includes 1104 companies from Iran (between 2011 and 2018) and 1058 companies from Venezuela (between 2011 and 2017). Results of analysis showed that there was a reverse significant relationship between EVA and stock returns in two stock exchanges of Iran and Venezuela because of the significance level less than 0.05 and coefficient by − 1.2. On the other hand, there was no such relationship observed between EVA and return on assets because the significance level was found higher than 0.05.

Keywords: Economic performance; Financial performance; Stock exchange; EVA; Stock returns; Return on assets (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1057/s41260-022-00300-1

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