J. Basic. Appl. Sci. Res., 3(10)316-320, 2013
© 2013, TextRoad Publication
ISSN 2090-4304
Journal of Basic and Applied
Scientific Research
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Corresponding Author: Narges Rahmaniani, Ph.D. student of Economic, School of Social Science, Razi University,
Kermanshah, Iran. E-mail: n_rahmaniay@yahoo.com
Identifying the Effects of Anticipated Benefit on the Price of Accepted
Companies in Tehran Stock Exchange
Shahram Fattahi
1
, Narges Rahmaniani
2
1
Department of Economics, School of Social Science, Razi University, Kermanshah, Iran
2
Ph.D. student of Economic, School of Social Science, Razi University, Kermanshah, Iran
Received: June 21 2013
Accepted: July 17 2013
ABSTRACT
The rate of profitability is one of the most important evaluating criteria of companies from investors’ views.For this
reasonthis study used method of estimating model based on panel data, this compound method is acquired from
information during 9 years (2001, 2009) and cross-sectional data of 140 companies that are accepted in Tehran
Stock Market and this model is in the form of a logarithm function. Results of this study show that there is a positive
relationship between anticipated benefit and share price.
KEYWORDS: Tehran Stock Exchange, time series, unanticipated benefit, trading volume
INTRODUCTION
Statement of the problem
According to the development and importance of capital markets is formation of small capitals, identifying
behavior of investors and price of share in the market is very important. Today, the share price of companies
influences from different financial and non-financial variables. The accounting price of the main product is a
commitment. Nothing takes the attention of investor groups except income per share. Probably in analyzing stock
exchange relationship between accounting benefit and price of stock exchange is one of the most important
relationships. Importance and significance of this subject is totally clear in the emphasis that has devoted to this
price. The rate of benefit is of the most important evaluating criteria of companies from investors. Announcements
of company benefit by an acknowledging public source will be provided for market actors to evaluate the operation
of company. The main purpose of this research is analyzing the relationship of anticipated benefit on the price of
share. Therefore, based on the importance of this subject we aimed to analyze the subject and evaluate the rate of
anticipated profit on the price of share.
LITERATURE REVIEW
Patel (1976) to evaluate the information content of anticipated benefit decided to test it by the impact of
representing anticipated profit on the price of share. Result of this study shows that representing anticipations entails
the adjustment of share price.
Penman (1980) showed that anticipations of benefit by manager are valid. These studies verify the reaction of
the share price than benefit anticipations and represent the positive relationship between unnatural revenues of share
and information of unexpected benefit that is transferred by predictions.
Bior, Lambert and Rian (1987) based on information of 1958 to 1976 reported a sensitivity (it means slope of
regression of percentage of changes in the price than changing's of benefit) with the mean of 0.31 that dramatically
distanced from one and zero. In other words, prices and benefits usually change in one direction but not in one ratio.
But prices may change because of unrelated and independent factors that influences on correlation. This lack of total
correlation is according to this idea that if benefits have an impermanent part, then reaction of prices to them is not
influential.
Studies of Kim and Verkechia (1991) that assumed to be informational symmetry among investors showed that
in the time period close to the announcement of income per share the price of share changes significantly and
because of increasing variance of changing price the trading volume will be affected similarly. Therefore, because of
informational symmetry in the market, announcement of income per share by sensible influences in changings of
price result in considerable changes in the volume of trading.
In 2001Bruit using variables based on accounting analyzed this subject that whether official value with cash
benefit is more able to justify the share price or official price and anticipated benefit per share. He emphasized that
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