The Impact of Financing Practices, Firm Growth and Dividend Practices on Firm’s Value as Mediated by Profitability

Authors

  • Muhammad Zia Ur Rehman Muhammad Zia Ur Rehman Khyber Pakhtunkhwa Revenue Authority.
  • Shams Ur Rehman Assistant Professor, Department of Management Sciences, Institute of Business and Management Studies (IBMS) Peshawar, Pakistan.

Abstract

In this study the mediating role of profitability among financing practices, firm growth, dividend payout and firm value has been examined. The study applies barren and canny model and structural equation model to examine the matter. A sample of 15 firms in manufacturing sector who have spent maximum time in Pakistan stock exchange from 2006 to 2016 are selected in the study. The results shows that profitability taken as ROA and ROE has a mediating role among financing decisions, profitability and firm value. However in some cases firm growth has an insignificant impact on firm value. Furthermore the association between profitability and firm value is weaker in some situations which might be due to the moderating role of profitability rather than mediation which may be further elaborated in future studies.

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Published

2021-09-30

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Articles