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Dissertation/Thesis Abstract

Relative Pricing of Publicly Traded U.S. Electric Utility Companies
by Jewczyn, Nicholas Stephen, Ph.D., Walden University, 2013, 264; 3594929
Abstract (Summary)

In the financial turmoil of 2008, U.S. firms reported debt-ratios that differed from the debt-ratios calculated from balance sheets. The problem is that investors bought common stock expecting initial investment return and lost money when companies delisted. The purpose of this quantitative study was to determine sample securities pricing with the application of synthetic assets and debt accrued. Addressed in the research questions was whether those securities were (a) underpriced compared with return-on-assets (ROA), (b) overpriced compared with ROA, (c) a debt-ratio higher than 60% and also overpriced, (d) underpriced with a synthetic asset added, or (e) related by relative pricing to variant pricing and market capitalization. The study's base theory was Pan's efficient market hypothesis (EMH) of security price prediction of market prices versus model prices. The data from the financial statements of 16 publicly traded U.S. electric utility companies were analyzed via correlations and multiple regression analyses to determine securities pricing and suitability. The findings from the analyses of the sample's variables of market price, book value, market-to-book, and study constructed variables from those variable data were statistically significant. The alternate hypotheses were accepted for all 5 research questions since the analytical operationalization of the hypothetical constructs led to significant relationships. Results suggest that the use of more pricing determinants in securities evaluation may lead to investors losing less money and earning the expected returns for a more efficient capital market, leading to a stronger economy and macroeconomic stability.

Indexing (document details)
Advisor: Sharifzadeh, Mohammad
Commitee: Aubey, Robert, Brent, William
School: Walden University
Department: Applied Management and Decision Sciences
School Location: United States -- Minnesota
Source: DAI-A 75/01(E), Dissertation Abstracts International
Subjects: Management, Economics, Finance, Energy
Keywords: Business, Electric utilities, Equities, Nontraditional, Publicly traded, Relative pricing, Valuation
Publication Number: 3594929
ISBN: 978-1-303-39816-2
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