Profitability Implications Of Capital Structure: A Study Of Consumer Goods Companies Quoted In This Nigerian Stock Market From 2006-2015
ABSTRACT
This study examined the
profitability implications of capital structure; with emphasis on consumer
goods companies quoted on the Nigerian Stock market for a period of ten years
from 2006-2015 . The objective of the study was to find the effect of
profitability on capital structure using performance proxies such as ROA and
ROE. For this study, ex-post facto research design was adopted. The method of
analysis was the use of ordinary least square regression model. Panel data
regression analysis was adopted using the fixed effects model to test the
hypotheses. The sample sue consisted of 15 companies with a total of 150
observations. The independent variables used for the study were total debt to
total asset (TDTA), long term debt to total asset (LTDTA), short term debt to
total asset (STDTA), degree of financial leverage (DFL) and equity share
capital (ESC). A key finding of this study was that debts which are long term
in nature have contributed positively to the growth of the industry in the last
ten years. The implication of the finding was that any debt which is not of long
term should not be considered as capital structure for consumer goods in
Nigeria. The study concluded that short term debts had negatively affected the
industry. The study recommended that long term debts conditions should be made
more attractive to consumer goods companies in Nigeria. This will provide
higher returns.
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IKWUAGWU, E (2021). Profitability Implications Of Capital Structure: A Study Of Consumer Goods Companies Quoted In This Nigerian Stock Market From 2006-2015. Repository.mouau.edu.ng: Retrieved Nov 28, 2024, from https://repository.mouau.edu.ng/work/view/profitability-implications-of-capital-structure-a-study-of-consumer-goods-companies-quoted-in-this-nigerian-stock-market-from-2006-2015-7-2
EMEKA, IKWUAGWU. "Profitability Implications Of Capital Structure: A Study Of Consumer Goods Companies Quoted In This Nigerian Stock Market From 2006-2015" Repository.mouau.edu.ng. Repository.mouau.edu.ng, 15 Jul. 2021, https://repository.mouau.edu.ng/work/view/profitability-implications-of-capital-structure-a-study-of-consumer-goods-companies-quoted-in-this-nigerian-stock-market-from-2006-2015-7-2. Accessed 28 Nov. 2024.
EMEKA, IKWUAGWU. "Profitability Implications Of Capital Structure: A Study Of Consumer Goods Companies Quoted In This Nigerian Stock Market From 2006-2015". Repository.mouau.edu.ng, Repository.mouau.edu.ng, 15 Jul. 2021. Web. 28 Nov. 2024. < https://repository.mouau.edu.ng/work/view/profitability-implications-of-capital-structure-a-study-of-consumer-goods-companies-quoted-in-this-nigerian-stock-market-from-2006-2015-7-2 >.
EMEKA, IKWUAGWU. "Profitability Implications Of Capital Structure: A Study Of Consumer Goods Companies Quoted In This Nigerian Stock Market From 2006-2015" Repository.mouau.edu.ng (2021). Accessed 28 Nov. 2024. https://repository.mouau.edu.ng/work/view/profitability-implications-of-capital-structure-a-study-of-consumer-goods-companies-quoted-in-this-nigerian-stock-market-from-2006-2015-7-2