Impact of the Capital Structure Tools on the Performance Indicators in the Listed Companies in Tehran Stock Exchange
Journal of Investment and Management
Volume 4, Issue 5, October 2015, Pages: 204-209
Received: Jul. 21, 2015; Accepted: Aug. 4, 2015; Published: Aug. 12, 2015
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Authors
Mostafa Zangiabadi, Faculty of Management and Accounting, Allame Tabatabaei University of Tehran, Tehran, Iran
Amin Rahimzade, Faculty of Management and Accounting, University of Qom, Qom, Iran
Mahdie Taboli, Scientific Group of Accounting, Department of Payame Noor University, Zangiabad, Iran
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Abstract
Today, one of the objectives of the financial managers is to maximize shareholder wealth, and in this context, determining the capital structure is a key factor. Due to tax benefits, the use of financial leverage is considered. On the other hand, due to higher interest costs associated with obtaining debt, bankruptcy may also exist. In conclusion, this study examines the impact of capital structure tools on the return on equity, return on assets and return on working capital. This paper examines the data from 2001 to 2011 companies listed in Tehran Stock Exchange. And the results after using the linear regression model, suggest that debt ratio is not affected on the return on equity, but is affected on the return on assets. while debt to net worth ratio and current and long-term debt to net worth ratio is affected on the return on equity. Also, the results show that debt to assets ratio and debt to net worth ratio and current and long-term debt to net worth ratio does not affect on the rate of return on working capital. And debt to net worth ratio and current and long-term debt to net worth ratio does not affect on the rate of return on assets. Overall, the results show that the capital structure affects on the performance of listed companies in Tehran stock exchange
Keywords
Capital Structure, Debt Ratio, Debt to Net Worth Ratio, Debt to Assets Ratio, Return on Equity, Return on Assets, Return on Working Capital
To cite this article
Mostafa Zangiabadi, Amin Rahimzade, Mahdie Taboli, Impact of the Capital Structure Tools on the Performance Indicators in the Listed Companies in Tehran Stock Exchange, Journal of Investment and Management. Vol. 4, No. 5, 2015, pp. 204-209. doi: 10.11648/j.jim.20150405.20
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