The Effect of Investment Opportunities, Growth and Capital Productivity on Firm Performance of Listed Companies in Tehran Stock Exchange

Subject Areas : Business Management

Heidar Mohammadzadeh Salteh ¹

1 - Assistant Professor of Accounting, Marand Branch, Islamic Azad University, Marand, Iran

Received: 2015-05-18 Accepted : 2015-09-27 Published : 2016-05-21

Keywords: Investors seek to maximize their wealth. Growth opportunities are the driving force that give motivation and are considered bonus for investors. What in the current situation will lead to success is the optimum use of the available investment opportu, from the perspective of capital market and management is an important variable and can be effective on firm performance. Therefore, in this research, the effect of investment opportunities and growth on firm performance of listed companies in Tehran Stock Exchange has been studied. The statistical population includes the companies listed in Tehran Stock Exchange, out of each a statistical sample of 134 corporates was selected by systematic elimination sampling method. The period under review was a 5-year period (2007-2011) and the hypotheses in this research were tested by using combined data (panel). The res, and firm growth has a positive and significant effect on return on asset but does not affect market value added. Also, capital productivity has a positive and significant effect on firm performance,

Abstract :

Investors seek to maximize their wealth. Growth opportunities are the driving force that give motivation and are considered bonus for investors. What in the current situation will lead to success is the optimum use of the available investment opportunities in order to identify the factors affecting the firm's performance. Timely and rational use of investment opportunities by business units has a significant effect on performance improvement. Firm growth, from the perspective of capital market and management is an important variable and can be effective on firm performance. Therefore, in this research, the effect of investment opportunities and growth on firm performance of listed companies in Tehran Stock Exchange has been studied. The statistical population includes the companies listed in Tehran Stock Exchange, out of each a statistical sample of 134 corporates was selected by systematic elimination sampling method. The period under review was a 5-year period (2007-2011) and the hypotheses in this research were tested by using combined data (panel). The results show that investment opportunities do not affect firm performance, and firm growth has a positive and significant effect on return on asset but does not affect market value added. Also, capital productivity has a positive and significant effect on firm performance.

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