Stock Yield and Information Asymmetry

  •  Ehsan Khansalar    
  •  Mahmoud Lari Dasht-Bayaz    
  •  Aref Miri    


One of the most fundamental economic problems is optimal allocation of resources towards high-yield investments with reasonable risk. For this achievement, it is required to have operational evaluation criteria that some of which emphasize on cash flow variables and some others on the information content of accounting interest. In order to achieve this end, in this study, the relationship between yields before interest and tax and operational cash flow with shareholders’ output in information asymmetry conditions during the life cycle of the listed companies in Tehran Stock Exchange was investigated. To do testing hypotheses, multiple pooled data Regression was used. To separate the companies through life-cycle, Anthony and Ramesh’s (1992) research was used. The results of empirical tests results, by using information related to 142 firms during 2008 to 2013, indicate that in each of three stages of growth-maturity and the firms’ fading and interest before benefit and tax-have no positive and significant relationship with the output of the firms’ stock on the other hand, the interest before benefit and tax rather than operational cash flow have more information content.

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