Abstract

GONCALVES, Cristina; ANDRAZ, Georgette; GUERREIRO, José  and  FERNANDES, Santana. USEFULNESS OF THE OVERALL RESULT FOR MARKET VALUE: THE CASE OF EURONEXT LISBON. Innovar [online]. 2018, vol.28, n.69, pp.25-39. ISSN 0121-5051.  https://doi.org/10.15446/innovar.v28n69.71694.

This research aims to study the importance of the global result compared to the net result of the components of another global result, considering the year and the sector factors, for the price and return of the securities traded on the Euronext Lisbon. Based on the reports and consolidated accounts (36 companies and 211 observations) with quoted securities (2010-2015), the goal is to know if the components of the comprehensive financial results have an explanatory power, and if such results are valued by investors in the price and return model. The option for the comparative analysis of models allows more solid and relevant conclusions. A statistically significant difference between the global result and the net result is confirmed. A statistically significant difference between the overall result and the net result is confirmed. However, it is not consistent within the analysis for each year or sector, which shows the influence of each sector's characterictics and the irregular nature (value and signal) of the components of other global results for each year. It is confirmed this information is reflected on the market value when it is material or signals market risks. The results of this research are consistent with other studies, but limited by the size of the sample and the small size of some sectors. However, this study contributes to the literature on this subject since results validate the controversy about the relevance of a global result and become important for normalizing and regulatory entities in relation to their request for detailed information on the overall result. These findings are also important for analysts and investors, considering the nature of the expected impact in the creation of market value.

Clasificación JEL: M41, M48, G14.

Keywords : Euronext Lisbon; other global result; global result; net result; market value.

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