A study of financial, operating and total leverage and its effect on investment decisions for selected Philippine real estate companies from years 2001 to 2010

Date of Publication

2012

Document Type

Bachelor's Thesis

Degree Name

Bachelor of Science in Commerce Major in Management of Financial Institutions

Subject Categories

Finance and Financial Management

College

Ramon V. Del Rosario College of Business

Department/Unit

Financial Management

Thesis Adviser

Junette A. Perez

Defense Panel Member

Edralin Lim
Lester
Carmelita Clerigo

Abstract/Summary

Several studies have been conducted to show the relationship between leverage and aggregate investment. Some of the inquiry concluded that leverage and investment are negatively related, where firms with higher debt ratios tend to invest less. This research analyzed the relationship of these two, with leverage divided into separate variables of financial and operating, as well as combined in the form of total leverage, in the context of listed real estate companies in the Philippines for the years 2001-2010. The primary method used in data analysis is the panel data regression, utilizing several financial ratios as independent variables in this study. Taking into account the heterogeneity of firms, the model of the equations is the least squares dummy variable model 1. The results suggest that leverage is not a significant indicator for investment decisions of real estate companies in the Philippines. However, return on assets, sales and cash flows show significant predictive power for investment decisions.

Abstract Format

html

Language

English

Format

Print

Accession Number

TU21697

Shelf Location

Archives, The Learning Commons, 12F, Henry Sy Sr. Hall

Physical Description

136 leaves : illustrations (some color)

Keywords

Real estate business--Philippines; Investments--Philippines

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