Rountree et al. (2008) show that investors do not like cash flow volatility. Consider the financial ratios
Question:
Rountree et al. (2008) show that investors do not like cash flow volatility. Consider the financial ratios presented in this chapter. Can you adapt an existing financial ratio or construct a new one that may reflect the findings in Rountree et al. (2008)?
Use your ratio to compare some firms in the same industry in your country. What are the strengths and weaknesses of your ratio?
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To adapt an existing financial ratio or construct a new one that reflects investors aversion to cash flow volatility we can create a measure that quan...View the full answer
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Related Book For 
Corporate Finance
ISBN: 9780077173630
3rd Edition
Authors: David Hillier, Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan, Jeffrey F. Jaffe
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