Research Journal of Finance and Accounting www.iiste.org ISSN 2222-1697 (Paper) ISSN 2222-2847 (Online) Vol.9, No.4, 2018 20 Evaluation of Firms’ Corporate Financial Indicators and Operational Performance of Selected Firms in Nigeria Onyekwelu, Uche Lucy, PhD Department of Accountancy, Faculty of Management Sciences, Enugu State University of Science and Technology Nnadi, Chikezie Sunday Onoh, Ph.D Department of Business Administration, Faculty of Management Sciences, Enugu State University of Science and Technology Iyidiobi, F.E . Department of Accountancy, Faculty of Management Sciences, Enugu State University of Science and Technology Abstract The study examined the effect of firms’ growth indicators on operational performance of selected firms in Nigeria. Firm size and profitability firms’ are the proxies for operational performance while Return on Assets was the measure for financial performance. The study adopted the ex-post facto research design. Data were sourced from the financial statement of firms studied. Multiple regressions were used for analysis. Results show that firm size and profitability have significant a negative and insignificant effect on Return on Assets. The paper recommends that firms should strive to increase firms size and profitability at a level that will positively and significantly affect Return on Assets. Keywords: Firms’ Financial Indicators , Firms’ Size, Profitability, Operational Performance, Return on Assets. 1.1 Introduction The factors that induce the growth and indeed the performance of firm can be enomous. Paramount among them is the ability of the management to harness and optimally take decisions that could impact positively on the firms. Firms ability to make and sustain profitability is key and basic in this regard. Investigators such as Panu, Peng and Dennis (2007) and Kogan (2012) have also found a strong relationship between firm sizeand profitability. Smaller firms appear to generate higher returns than larger firms. Again, the interpretation of these results is controversial. The excess returns of small firms can be interpreted as inefficiency, but they also may represent compensation for bearing risk. Smaller companies may be far more sensitive to economic shocks than are larger firms (Enufe and Oladutire, 2014). Growth is another characteristics of firm that is perceived to influences profitability (Yasuda, 2005). Sales and income growth can be expected to influence rate of return and market value measures in both simulated and actual industries. It is unclear if growth in one year will affect profitability and market value measures in a succeeding year in simulated and actual environments. Asset growth, which can be used as a proxy for plant and equipment expenditures, and research intensity, may also affect sales and income growth in a base year or succeeding year, indirectly affecting profitability and market value (Kugari, 2013). Firm age (measured as the number of years a company is operating in the market since it was founded) is an important determinant of financial performance and stock returns (Kaguri, 2013). Past research shows that the probability of firm growth, firm failure, and the variability of firm growth decreases as firm’s age (Evans, 1987; Yasuda, 2005).According to the life cycle effect, younger companies are more dynamic and more volatile in their growth experience than older companies (Kogan, 2012). Maturity brings stability in growth as firms learn more precisely their market positioning, cost structures and efficiency levels and these influences stock prices.Profitability of the firm is another dimension of the firm’s characteristics (Kaguri, 2013). EPS (Earning per share), which is a function of profitability usually have significant positive influence on market return as shown in many past researches. In the light of this, the higher the firm’s EPS, the higher market adjusted return and abnormal return that can be resulted by firm’s stock, because a higher EPS means higher profit obtained from every dollar price earned by the firm. Investors/shareholders consider current earnings, future earnings, and earnings stability are important, thus they focus their analysis on firm’s profitability Oloidi and Bolade(2015). They concern financial condition which will affect firm’s ability to pay dividend and avoid bankruptcy. It is in against this backdrop that this paper evaluated the firms’ corporate financial indicators and operational performance of selected Nigeria firms.