Cash flows and leverage adjustments

By F. Sharifi, Seyedeh Mahbubeh Jafari. 2016

195 citations recorded by the source corpus.

Article history: Received December 5, 2015 Received in revised format February 16 2016 Accepted March 18 2016 Available online April 8 2016 Cash flow and leverage are two main components of any business firms. A good level of cash flow and leverage shows a desirable performance for business organizations. This paper presents an empirical investigation to study the relationship between combined leverage and cash flow in terms of board of director’s ownership and corporate governance structures. The study selects 86 randomly selected firms listed on Tehran Stock Exchange over the period 2009-2013. Using some statistical tests, the survey has indicated that there was a meaningful relationship between leverage and cash flow for firms with different corporate governance structures. The study has also determined that there was a meaningful relationship between leverage and cash flow for firms with different board of director’s ownerships. Growing Science Ltd. All rights reserved. 6 © 201

Subfields: Accounting

View Paper: https://www.semanticscholar.org/paper/01c3dbc0993f2e247542dac808c3ec19ab435eba

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Citations in the corpus

Financing Major Investments: Information About Capital Structure Decisions (2014, unknown): “(2007), Faulkender et al. (2011)). Second, the resulting dynamic panel models pose estimation challenges that have made it difficult to produce definitive results (e.g. Chirinko and Singha (2000), Chang and Dasgupta (2009), Iliev and Welch (2010)).”
In Search of Robust Methods for Dynamic Panel Data Models in Empirical Corporate Finance (2015, unknown): “Rajan and Zingales (1995); Flannery and Rangan (2006); Byoun (2008); Lemmon, Roberts, and Zender (2008)), we expect leverage to be inversely related to profitability and the market-to-book ratio, but positively associated with firm size, tangibility, and the industry median of leverage (see also Par”
Tax Avoidance and Ex Ante Cost of Capital (2017, unknown): “Building on this tradeoff theory, numerous studies (e.g., Flannery and Rangan 2006; Faulkender et al. 2012; Flannery and Hankins 2013) have developed partial-adjustment models to examine how quickly firms adjust to their target capital structures.”
Capital Structure Decisions around the World: Which Factors Are Reliably Important? (2015, unknown): “…model equation (6) and rearranging yields the following: I estimate equation (8) using a country-ﬁxed-effects estimator (ordinary least squares estimation yields similar results) with bootstrapped standard errors to account for the generated regressor (Pagan (1984), Faulkender et al. (2012)).”
The Impact of Capital Structure on Risk and Firm Performance: Empirical Evidence for the Bucharest Stock Exchange Listed Companies (2018, background): “Frank and Goyal (2009) grouped the theories on capital structure into two categories, correlated with the market imperfections: • the bankruptcy costs issue: trade-off theory (henceforth “TOT”); • the agency cost and information asymmetry issue: pecking order theory (henceforth “POT”) and market…”
How Persistent is Private Equity Performance? Evidence from Deal-Level Data (2017, methodology): “In the literature on corporate capital structure decisions, AR1 regression set-ups are applied to analyse the extent to which companies adjust their leverage towards a target value every year (see e.g. Flannery and Rangan, 2006; Faulkender et al., 2012).”
Fire‐Sale Spillovers and Systemic Risk (2015, unknown): “Passive leverage b it+1 is constructed according to equation (2) with ∆es it+1 measured by net income (Faulkender et al., 2012) while net issuance ∆eiss it+1, debt dit, and equity eit are directly obtained from the balance sheet data.”
Stock Market Listing and the Use of Trade Credit: Evidence from Public and Private Firms (2017, methodology): “Our estimation strategy involves estimating Models (3) and (2) in sequence, which is similar to the two-stage approach used by several recent studies of capital structure or cash adjustments (e.g., Byoun, 2008; Faulkender et al., 2012; Gao et al., 2013).”