A Sustainable Growth Rate Analysis of Non-Financial Companies Listed on the Banja Luka Stock Exchange
Journal Title: Acta Economica - Year 2016, Vol 14, Issue 24
Abstract
In this research project and paper, we propose to assess the sustainable growth rates of non-financial companies listed on the Banja Luka Stock Exchange. A company’s sustainable growth rate is the maximum rate its sales can grow, given the company’s profitability, earnings retention, asset management, and financial leverage. A company’s sales cannot grow at a rate higher than its sustainable growth rate unless one or more of these levers of performance increases or the company issues additional equity. Companies that grow at rates higher than their sustainable growth rates and finance the their asset growth with debt financing experience higher financial leverage that can lead to financial distress and ultimately bankruptcy.
Authors and Affiliations
Горан Радивојац, Џорџ В. Кестер
Keywords
Related Articles
- EP ID EP43824
- DOI https://doi.org/10.7251/ACE1624053R
- Views 257
- Downloads 0
ECONOMIC FREEDOM AND DEVELOPMENT OF SMALL COUNTRIES
Economic freedom is an important prerequisite for achieving economic growth and development, especially for small countries that do not have the bargaining power for anti-liberal economic policies, nor can they determine...
PRIVATISATION – KEY LINK FROM SOCIALISM TO CAPITALISM
The transition process is multidimensional; the overall purpose being the social and economic re–arrangement with privatisation being a key factor. In essence, the transition involves the rejection of the bureaucratic ec...
EVALUATION OF LOAN – MODELS OF EQUAL PRINCIPALS REPAYMENTS WHICH ARE PAID m TIMES IN YEAR
This paper presents the account of loan evaluation, i.e. loan value assessment during amortization with equal principals repayments which are paid m times in year. Given the loan evaluation moment, there could emerge two...
Improvement of workforce quality in the function of reducing structural unemployment in Republic of Srpska
Погоршање индикатора тржишта рада је реланост са којом се данас сусрећу многе земље. Стопа незапослености у Републици Српској константно расте већ низ година и тренутно је 2,5 пута већа од просјечене стопе незапослености...
Ways of choice of global marketing strategies
At the beginning of the 21th century changes caused by globalisation have became real and present in all areas of society. The most signifcant changes are changes on the market and changes in business activities. Changes...