ACCOUNTING INFORMATION AND STOCK PRICE: EVIDENCE FROM QUOTED CONSUMER GOODS MANUFACTURING FIRMS
Keywords:
Accounting Information, Earning per Share, Return on Assets, Stock priceAbstract
This thesis investigated the relationship between accounting information and the stock price of publicly traded consumer goods manufacturing firms in Nigeria. The specific objectives were to analyze the relationships between EPS and stock price, the relationship between ROA and stock price of quoted consumer goods manufacturing firms. The study adopted ex post facto research design. The population comprises twenty-one quoted manufacturing firms in the Nigerian Exchange Group (NGX). The study employed descriptive and inferential statistical techniques to analyze the data. The study utilized secondary data from 2011 to 2021 retrieved from annual financial reports. The study analyzed the data using the pooled OLS regression technique. The results revealed that EPS had a non-significant negative effect on stock price, whereas ROA had a significant positive effect on the firm's stock price. The study therefore recommended that investors critically analyze earnings information, for it may be potentially misleading if used as the only criteria for assessment. This is because managers often employ managerial discretion in the selection of accounting policies to shore up performance over time. This study contributes to the literature by identifying the futility of using profitability indicators as a yardstick for stock purchase decisions.
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