Value Relevance of Accounting Information and Share Price of Listed Manufacturing Companies in Nigeria

VALUE RELEVANCE OF ACCOUNTING INFORMATION AND SHARE PRICE OF LISTED MANUFACTURING COMPANIES IN NIGERIA

Apete, Collins

Department of Accountancy

Nnamdi Azikiwe University, Awka

Mail: collinzo78@yahoo.co.uk

Udeh, Francis N.

Department of Accountancy

Nnamdi Azikiwe University, Awka

Mail: fn.udeh@unizik.edu.ng

Ezekwesili, Tochukwu P.

Department of Accountancy

Nnamdi Azikiwe University, Awka

Mail: ezekwesilitochukwu@gmail.com

Abstract

The broad objective of this study is to ascertain the relationship between value relevance accounting information and share price of listed manufacturing companies in Nigeria. The research design that is employed in this study is Ex-Post Facto research design. The population of the study comprised of twenty one (21) quoted consumer goods manufacturing firms on the Nigerian Stock Exchange. Since the population of the population is not large, the researcher used all the population size for the study. Data were sourced from publications and the annual report and accounts of the listed companies. This study employed Ordinary Least Square (OLS) estimate using panel data from 2012 to 2020 covering a period of nine (9) years to arrive at a final conclusion. The study found that there is significant negative relationship between Book Value of Equity per Share and Share Price of manufacturing firms listed on NSE. While earnings per share has a significant positive relationship with Share Price of the manufacturing firms listed on NSE. Based on the findings, the study recommended among others that listed manufacturing firms on the Nigerian Stock Exchange should display their Book Value per Share conspicuously in their presentation to investors and analysts. This will, on the long run, assist financial analysts and other interested parties in easy determination of firm’s share prices.

 Keywords: Accounting information, Book value, Earnings per share and Share price

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Apete, C.; Udeh, F.N & Ezekwesili, T.P (2022). Value Relevance of Accounting Information and Share Price of Listed Manufacturing Companies in Nigeria. Research Journal of Management Practice, 2(1), pp11-28. Available online at: https://www.ijaar.org/articles/rjmp/v2n1/rjmp-v2n1-Jan22-p2192.pdf.

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