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The Analysis Of The Relation Country Risk - Multiple Value

Author

Listed:
  • Cristina Nicolescu

    (Finance Department, Faculty of Economics and Business Administration, West University of Timişoara Timişoara, Romania)

  • Claudiu Boţoc

    (Finance Department, Faculty of Economics and Business Administration, West University of Timişoara Timişoara, Romania)

  • Ciprian Codău

    (Partner DARIAN DRS SA)

Abstract

Financial theory state that high expected growth, low risk in the company’s sector and low interest rates will push multiples higher. In this respect the goal of the empirical work is to examine country risk-multiple value relation, for the companies from emerging and frontier markets such as Central and East European ones. Specific control variables have been included in the model as proxy for growth opportunities, profitability, capital structure, and asset utilization. Using panel data analysis for period 2010-2015 as well as other financial variables for a sample of Central and East European countries during 2010-2015. The results partially support financial theories, mainly the significance of country risk and debt ratio and reject the growth opportunities hypothesis.

Suggested Citation

  • Cristina Nicolescu & Claudiu Boţoc & Ciprian Codău, 2016. "The Analysis Of The Relation Country Risk - Multiple Value," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(2), pages 356-363, December.
    • Handle: RePEc:ora:journl:v:1:y:2016:i:2:p:356-363
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    More about this item

    Keywords

    multiple value; country risk; growth; profitability; capital structure; asset utilization;
    All these keywords.

    JEL classification:

    • C - Mathematical and Quantitative Methods
    • G - Financial Economics

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