In this paper, the difference in the target leverage during the life cycle of companies listed on the Tehran Stock Exchange is examined. Leverage is the ratio of the proportion of debt a company tends to achieve, and the leverage ratio is defined as the distance between
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In this paper, the difference in the target leverage during the life cycle of companies listed on the Tehran Stock Exchange is examined. Leverage is the ratio of the proportion of debt a company tends to achieve, and the leverage ratio is defined as the distance between operating cash flow and the time required to invest, and is structured based on trade-off theory (TOT) and pecking order theory (POT) the optimal investment is determined. For this purpose, using GMM method, 153 companies listed on the Tehran Stock Exchange in the period of fiscal year 2011 to 2018 were selected and data analysis was performed using stata and eviews software. In examining the factors affecting the difference in leverage, growth and profitability opportunities were more stable than the size and tangible fixed assets. The findings of this study are important for researchers because the results show that the classification ratio of companies at different stages of the life cycle, the interpretation of the results by considering the factors affecting the structure of the target capital. Therefore, researchers espacialy financial managers could check the assignment of their firms intothe life stage by this model in order to compare their firms’capital structure in the same stage because their behavior change iver the life cycle.
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