A Study That Identify the Relationship between the Financial Leverage and Firms Profitability: Empirical Evidence from Oil and Gas Companies of Pakistan Listed In KSE [ READ ]
Tooba Raheel, Faiza Maqbool Shah
This study identifies the relationship between the financial leverage and Firms profitability of Oil and Gas marketing companies of Pakistan listed on Karachi Stock Exchange (KSE). The study was identified 05 companies listed on the KSE for the period starting from year 2007 to 2012. The Degree of Operating Leverages (DOL), Degree of Financial Leverage (DFL) & Degree of Combined Leverage (DCL) are the independent variables and Earning per Share (EPS) is the dependent variable for this study. The present study used the correlation coefficient and linear regression to measure the variables. The findings revealed that there is no significant relationship of DOL, DFL and DCL with EPS. Thus, fixed operating expenses and the financing mix decisions of the firm are not significantly impact the earning capacity of the listed companies in KSE.
Tooba Raheel, Faiza Maqbool Shah
This study identifies the relationship between the financial leverage and Firms profitability of Oil and Gas marketing companies of Pakistan listed on Karachi Stock Exchange (KSE). The study was identified 05 companies listed on the KSE for the period starting from year 2007 to 2012. The Degree of Operating Leverages (DOL), Degree of Financial Leverage (DFL) & Degree of Combined Leverage (DCL) are the independent variables and Earning per Share (EPS) is the dependent variable for this study. The present study used the correlation coefficient and linear regression to measure the variables. The findings revealed that there is no significant relationship of DOL, DFL and DCL with EPS. Thus, fixed operating expenses and the financing mix decisions of the firm are not significantly impact the earning capacity of the listed companies in KSE.
