The effect of commodity price changes on firm value: study of food and drink industries

The effect of commodity price changes on firm value: study of food and drink industries

Author by Dr. Monisola Alao

Journal/Publisher: European Journal Of Accounting Auditing And Finance

Volume/Edition: 3

Language: English

Pages: 26 - 38

Abstract

This paper examines the effect of commodity price changes on firms’ value in the food and beverage industry in Nigeria given the frequent changes in the prices of raw materials and inflation. Using the descriptive survey research design, the study focused on secondary data obtained from the annual reports of 11 firms registered on the stock exchange, whose records provided the information required for the study. Revenue, cost of sales, and stock price were computed in order to represent company price of commodity from 2009 to 2013; while firm value comprises Earnings per Share, Earnings before Interests and Taxes and Total Assets. Findings indicate, a significant positive relationship between commodity price and firm value (p<0 p=0.000); xss=removed>


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