THE RELATIONSHIP BETWEEN FINANCING POLICY AND FINANCIAL PERFORMANCE IN THE BRAZILIAN TEXTILE INDUSTRY
Abstract
This article analyzes the financing policy of the leading companies that comprise
the textile industry in Brazil from 1998 to 2006, as well as the influence of this
policy on firm performance. Variables were used as performance metrics
traditional ROA and ROE for a representative sample of 180 companies with
revenues of U.S. $ 7.99 Billion. The structure of the research was supported by
multiple regression analysis and developed in two phases: the entire sample and
with the 10 largest companies by market share.
The results show significant influence and a negative correlation between
performance and debt. There was also that the best results have debt less than
45% of the capital structure. Therefore, the search terminates further discussions
within the financing policies of firms.
References
- ASSAF NETO, A. (2010), Finanças Corporativa e Valor. São Paulo: Atlas.
- DURAND, D. (1952), Costs of Debt and Equity Funds for Business: Trends and Problems of Measurement. Conference on Research in Business Finance. Universities-National Bureau, pp. 215-262.
- GITMAN, L. J. (2004), Princípios de Administração Financeira. 10. ed. São Paulo: Pearson Addison Wesley.
- GUJARATI, D. (2006), Econometria Básica. Rio de Janeiro, Elsevier.
- HAIR Jr., J. F. et al. (2005), Análise Multivariada de Dados. Porto Alegre, Bookman.
- MYERS, Stewart C.; MAJLUF, Nicholas S. (1984), Corporate Financing and Investment Decisions When Firms Have Information Investors Do Not Have. Journal of Financial Economics, Vol.13, pp. 187-222.
- MODIGLIANI, F; MILLER, H. (1958) The Cost of Capital, Corporation Finance and the Theory of Investmient. The American Economic Review, Vol. 48, No. 3, pp. 261-297.
- MODIGLIANI, F; MILLER, H. (1963) Corporate Income Taxes and the Cost of Capital: A Correction. The American Economic Review, Vol. 53, No. 3, pp. 433- 443. ROSS, S. A.; WESTERFIELD, R. W.; JAFFE, J. F. (2002), Administração Financeira (Corporate Finance). São Paulo, Atlas.
- SHAPIRO, A. (1989) Modern Corporate Finance. New York, Macmillan.
- TITMAN, S. (1984) The Effect of Capital Structure on a Firm’s Liquidation Decision. Journal of Financial Economics, Vol. 13, pp. 1371-1375.
Abstract
References
- ASSAF NETO, A. (2010), Finanças Corporativa e Valor. São Paulo: Atlas.
- DURAND, D. (1952), Costs of Debt and Equity Funds for Business: Trends and Problems of Measurement. Conference on Research in Business Finance. Universities-National Bureau, pp. 215-262.
- GITMAN, L. J. (2004), Princípios de Administração Financeira. 10. ed. São Paulo: Pearson Addison Wesley.
- GUJARATI, D. (2006), Econometria Básica. Rio de Janeiro, Elsevier.
- HAIR Jr., J. F. et al. (2005), Análise Multivariada de Dados. Porto Alegre, Bookman.
- MYERS, Stewart C.; MAJLUF, Nicholas S. (1984), Corporate Financing and Investment Decisions When Firms Have Information Investors Do Not Have. Journal of Financial Economics, Vol.13, pp. 187-222.
- MODIGLIANI, F; MILLER, H. (1958) The Cost of Capital, Corporation Finance and the Theory of Investmient. The American Economic Review, Vol. 48, No. 3, pp. 261-297.
- MODIGLIANI, F; MILLER, H. (1963) Corporate Income Taxes and the Cost of Capital: A Correction. The American Economic Review, Vol. 53, No. 3, pp. 433- 443. ROSS, S. A.; WESTERFIELD, R. W.; JAFFE, J. F. (2002), Administração Financeira (Corporate Finance). São Paulo, Atlas.
- SHAPIRO, A. (1989) Modern Corporate Finance. New York, Macmillan.
- TITMAN, S. (1984) The Effect of Capital Structure on a Firm’s Liquidation Decision. Journal of Financial Economics, Vol. 13, pp. 1371-1375.
Details
| Other ID | JA37DP74RZ |
|---|---|
| Journal Section | Articles |
| Authors | |
| Publication Date | December 1, 2011 |
| Published in Issue | Year 2011 Volume: 3 Issue: 2 |