Bakri Abdul Karim, Annescia Franciene Patres, Bridney Chow Yi Ying, Jefferson Tiong Kung Lien
{"title":"THE IMPACTS OF FINANCIAL RATIOS ON STOCK PRICES IN MALAYSIA: EVIDENCE FROM BANKING INDUSTRY","authors":"Bakri Abdul Karim, Annescia Franciene Patres, Bridney Chow Yi Ying, Jefferson Tiong Kung Lien","doi":"10.33736/uraf.6380.2023","DOIUrl":null,"url":null,"abstract":"The objective of this study is to identify whether the financial ratios have an impact towards the stock price in the banking industry of Malaysia. The financial ratios used in this study are the net profit margin, price to earnings ratio and dividend payout ratio. The sample collected for this empirical study covered 10 years of data from 2013-2022. The study found that the net profit margin and price to earnings ratio boost stock price, however the dividend payout ratio decreases stock price. The influence of net profit margin and dividend payment ratio on stock price is negligible, in contrast to price to earnings ratio, which has a large effect on stock price.","PeriodicalId":187805,"journal":{"name":"UNIMAS Review of Accounting and Finance","volume":"301 2‐3","pages":""},"PeriodicalIF":0.0000,"publicationDate":"2023-12-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"UNIMAS Review of Accounting and Finance","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.33736/uraf.6380.2023","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"","JCRName":"","Score":null,"Total":0}
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Abstract
The objective of this study is to identify whether the financial ratios have an impact towards the stock price in the banking industry of Malaysia. The financial ratios used in this study are the net profit margin, price to earnings ratio and dividend payout ratio. The sample collected for this empirical study covered 10 years of data from 2013-2022. The study found that the net profit margin and price to earnings ratio boost stock price, however the dividend payout ratio decreases stock price. The influence of net profit margin and dividend payment ratio on stock price is negligible, in contrast to price to earnings ratio, which has a large effect on stock price.