Abstract
The goal of the research is to present relations between the ability to generate value and risk in agribusiness companies. The ability to generate value of analyzed entities was determined using a rate of return on invested capital expressed by economic value addend (EVA). To characterize the risk of business indicators of operating and financial leverage were used. In periods of higher leverage lower rates of return on invested capital were noticed. The main reason for growth of the degree of leverage was an increase in the share of fixed cost in gross margin along with a decrease of operating profit. This gave an evidence of a negative influence of risk expressed by leverage on ability to generate value in agribusiness companies.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: Annals of the Polish Association of Agricultural and Agribusiness Economists
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
