Dynamic capital structure under changing market conditions in the oil industry: An empirical investigation

Restrepo, Natalia; Uribe, Jorge M.; Manotas-Duque, Diego Fernando

doi:10.1016/j.resourpol.2020.101808

Cited by 11 publications

(7 citation statements)

References 32 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Many studies are devoted to the choice of the optimal capital structure that will allow the company to continue the growth and maintain the financial sustainability and profitability, even under the influence of external factors such as inflation and financial crises (Frank and Goyal, 2003;Vintil a et al, 2019). Some researchers (Gan et al, 2020;Restrepo et al, 2020) recognize the need to optimize the capital structure, but do not determine the critical share of borrowed funds. Chung et al (2013) introduce the concept of "firm survive probability" and reveal the optimal share of borrowed capital of 48.5% for the oil exploration companies.…”

Section: Impact Of Hightech Companies' Performancementioning

confidence: 99%

The impact of high-tech companies’ performance and growth on capital structure

Spitsin

Vuković

Spitsina

et al. 2021

View full text Add to dashboard Cite

Purpose The purpose of this paper is to investigate the joint influence of two factors (companies’ performance and growth) on the company’s capital structure and to determine the conditions for financially sustainable competitive strategies in the coordinates profitability and growth. Design/methodology/approach The study sample includes 1,996 companies from 6 high-tech industries in Russia (panel data: 7,984 observations). The authors use regression models with random effects and carry out a three-dimensional visualization of the resulting dependencies. Findings The study found that profitability improves the capital structure (reduces the share of borrowed capital) and, on the contrary, the growth of companies (assets growth or sales growth) increases the leverage ratio. In the case of assets growth, the combined influence of two factors reduces the negative effect of assets growth. The results have shown that the outstripping growth of most high-tech companies requires an increase in debt capital and deterioration in the capital structure and financial stability. Practical implications In general, based on the results of this study, the authors have identified groups of fast-growing companies that need financial support, and have defined the main areas of impact (reducing the loan burden and increasing profitability) that will allow these companies to maintain high growth rates and demonstrate advanced development. Originality/value The relationships (which the authors identified between the control variables, the studied variables and leverage) were obtained for the first time for a sample of companies in high-tech industries and services in bigger transition country (Russia).

show abstract

Section: Impact Of Hightech Companies' Performancementioning

confidence: 99%

The impact of high-tech companies’ performance and growth on capital structure

Spitsin

Vuković

Spitsina

et al. 2021

View full text Add to dashboard Cite

show abstract

“…Also industry type reflects capital structure. Oil companies prefer to issue long-term debt, that increases capital structure (Restrepo et al, 2020).…”

Section: Research Questionsmentioning

confidence: 99%

Microeconomic Factors Identifying Life Cycle Stage And Macroeconomic Factors Enhancing Development

Красильникова¹

2021

European Proceedings of Social and Behavioural Sciences

View full text Add to dashboard Cite

show abstract

“…For example, recent studies reveal that financial leverage improves financial performance and, therefore, decision-making regarding the capital structure is determining for this performance (Akhtar et al, 2012). In this way, Restrepo et al (2020) analyze the oil sector's capital structure and find changes in companies' capital structure over time. One crucial finding is firms' sensitivity to investment decisions depending on their decision to raise capital by issuing more or less debt.…”

Section: Literature Reviewmentioning

confidence: 99%

“…In Canada's case, there is a study regarding the effect of oil prices and reserves on the return of stocks of oil and gas companies (Boyer & Filion, 2007). A recent study by Restrepo et al (2020) is related to oil and gas companies' capital structure in the nyse. Nonetheless, there is no evidence on additional research about determining factors of profitability for oil and gas companies in the American Continent.…”

Section: Literature Reviewmentioning

confidence: 99%

The Profitability of Electricity, Oil, and Gas Utilities in America

Murillo

Ramos

2021

Rev. fac. cien. econ.

View full text Add to dashboard Cite

Identifying the determining factors of utilities’ profitability is vital in making strategic deci- sions such as optimal resource allocation and business strategy orientation to increase the invested capital. We analyze information from private and public companies in the energy, gas, and oil sectors in Colombia and other American countries. We construct a panel data model from 2000 to 2010 and propose a method that identifies the determining factors of profitability for homogeneous groups of companies using cluster analysis. We use regression analysis to quantify those factors for each cluster. Fixed assets are essential determining factors of profitability; however, investment regulation may lead to significant losses in the realizable value of fixed assets and an increase in the companies’ capital costs. Debt and a munificent environment only affect medium-sized companies. We found some benefits for large companies derived from non-transparent institutional environments.

show abstract

Dynamic capital structure under changing market conditions in the oil industry: An empirical investigation

Cited by 11 publications

References 32 publications

The impact of high-tech companies’ performance and growth on capital structure

The impact of high-tech companies’ performance and growth on capital structure

Microeconomic Factors Identifying Life Cycle Stage And Macroeconomic Factors Enhancing Development

The Profitability of Electricity, Oil, and Gas Utilities in America

Contact Info

Product

Resources

About