| Abstract [eng] |
Country’s financial activities and capital markets are the core of its economic development and investors are constantly looking for the most efficient opportunities to invest additional resources. As a result, one of the most important objects of any analysis becomes companies’ share price and the factors influencing it. In order to achieve a profitable investment with a minimal risk, companies’ financial statements and their analysis are always used. For this reason, scientific sources abound in studies that analyze the impact of financial ratios on stock prices, but most of these analyses are performed in markets at a certain level (developing and developed), without much emphasis on comparing different markets. In the first part of this work, the broad analysis was done on literature researching the connection between financial indicators and stock prices. How relevant it is? What problematic challenges it poses? Analysis revealed that information technology sector is considered to be one of the most promising investment objects, but a lack of research in the scientific literature comparing developing and developed markets is seen. For this reason, the aim of this work is to determine the relationship between financial indicators and stock prices in developed and developing markets, based on the example of companies in the information technology sector. Object of the research is factors determining the share prices of companies in information technology sector. In the second part, theoretical solutions of the relationship between financial indicators and stock prices are performed - research conducted by other authors is reviewed, differences between developing and developed markets are identified. It has been observed that financial indicators of profitability, liquidity, investment and operational risk are mostly analyzed and used in the scientific literature. Meanwhile, macroeconomic controlled variables such as gross domestic product, consumer price index, foreign direct investment, etc. are also used to ensure the accuracy of the results. On the other hand, it has been found that there is no single common method to separate developed and developing markets when the level of development is assessed. However, certain market characteristics and criteria do exist, which allow a fairly accurate assessment of the stage of development of a particular market. The third part presents the methodology of empirical research. This paper analyzes stock markets of the United States, Japan, China and Taiwan in 2009-2018. The chosen research method is correlation and regression analysis of panel data. In this same part you can find: the aim and hypothesis of the research, independent, dependent and controlled variables planned to be used, also process and limitations of the research. An empirical study of the relationship between financial indicators and stock prices in developing and developed markets is conducted in the fourth part of this work. It was established that while the results reject the hypothesis that different markets have different financial ratios with a statistically significant relationship to the share price, it was observed that one chosen financial ratio may have a different effect on the share price in different markets. Financial leverage (FL), earnings per share (EPS) and return on assets (ROA) have been found to be more significant in developing markets than in developed ones. On the other hand, the gross margin ratio (GMR) proved to be more significant in developed markets. |
