The Relationship Between The Leverage And Stock Earnings An Application In a Sample From AL-Jordan Stock Companies | ||
| مجلة جامعة الانبار للعلوم الاقتصادیة والاداریة | ||
| Article 7, Volume 4, Issue 8, August 2012, Pages 147-169 PDF (0 K) | ||
| Authors | ||
| Alyas K. Al-Hamdoni; Faaz H. Al-Sbaihi | ||
| Abstract | ||
| Borrowing is considered as one of the usual methods of funding in most companies, according to the number of variables including the size of the company and the nature of the activity it performs, as well as the possibility of fulfilling their obligations on time. Moreover, the increase in company borrowing leads to the increase in financial leverage as well as increase of risks accompanied. But it directly affects the right of ownership through higher earnings per share in the company. The theoretical side of this study aimed at understanding the main concepts of financial leverage and average of its effect to the earning of share and the structure of capital to reach to the optimal structure of the capital. The study relied on a number of hypotheses to test the relationship between financial leverage from one side and the systematic risk, the overall risk and the earning per share from the other side by applying it on a sample of AL-Jordan stock companies registered to Oman market of the period 2005 – 2009. In order to reach to the results of the study, the method of simple linear regression analysis was used to make test to the hypotheses of the study by measuring the relationship between the financial leverage from one side and each of the systematic risk measured by Beta coefficient, the overall risk measured by standard deviation and the earning per share from the other side. | ||
| Keywords | ||
| leverage; Stock Earnings | ||
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