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Title: An empirical study on effect of financial accounting indicators towards stock market price volatility

Authors: S. Umamaheswari; C.K. Suresh; Shilpa Sampathkumar

Addresses: School of Commerce, Jain Deemed to be University, Bangalore, India ' School of Commerce, Jain Deemed to be University, Bangalore, India ' School of Commerce, Jain Deemed to be University, Bangalore, India

Abstract: In the Indian stock market, the stock market price volatility is an unavoidable part of an investment decision of individual investors. It is essential to identify that share price of listed companies affected due to the financial statement information like EPS, DPO, PE, return on capital employed, and return on investment, which are treated as influential factors of investors investment decision making. Therefore, the study examined the effect of listed companies' financial information towards stock price instability. The present research work has taken 12 listed companies from various industrial sectors listed under the National Stock Exchange of India and to determine the effect of accounting variables like EPS, PE and DPO ratio on stock cost volatility for the duration of five years (2014-2019). The result of the study revealed that most of the company stock prices are indicated instable due the accounting indicators like EPS and dividend payout among those periods but not because of PE ratio. Hence, the study has concluded and suggested that all companies should focus on providing absolute information about their financial statement indicators and it is helpful to the individual investor's investment decisions.

Keywords: finance indicators; stock price volatility; EPS; DPO; PE.

DOI: 10.1504/WRSTSD.2021.10036120

World Review of Science, Technology and Sustainable Development, 2022 Vol.18 No.1, pp.99 - 106

Accepted: 10 Dec 2020
Published online: 01 Dec 2021 *

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