| Abstract [eng] |
The purpose of this master thesis is to determine non-financial Lithuanian joint stock company’s investment behavior and what kind of factors make an impact. The work consists of three main parts: literature review about company’s investment behavior, methodology part and description of the analysis and results. Research is made by using several different methods. Both foreign and Lithuanian research papers were analyzed, compared and results showed graphically. The impact of factors is calculated by using regression and factor analysis. All the calculations are made by taking data from 16 Lithuanian Joint stock companies’ financial statements of period 2008-2018. Research of scientific literature revealed a lot of indicators which have the impact on company’s investment behavior. They were classified into four groups: board behavior, company financial performance, external factors and company’s internal policies. Important attention was made on cognitive factors that have an impact on manager’s and investor’s behavior such as high confidence, loss aversion, anchoring and self-serving biases. Those factors encourage investments but reduce efficiency. Analysis of companies’ financial statements showed that around 25 % of company’s total assets contains financial assets such as cash and their equivalents, current receivables, investments in subsidiaries and associates, other companies shares, securities and financial derivatives. Regression analysis was made between total company’s financial assets and twelve other independent variables that are related with financial performance. It showed positive significant relationship with coefficient of variation in return on capital and gross margin. Also, negative impact is made by debt to equity and financial constraints. This shows that a company with higher profitability and lower liabilities can invest more. On the other hand, those four indicators explain only 36% of the model. Factor analysis showed similar results. In this way, assumption could be made that left amount of the model is explained by other factors such as manager’s behavior that is difficult to predict. Investment into financial assets for companies is a good possibility to gain new profit or maintain the current earnings value. On the other hand, non-financial companies should choose their investments precisely by evaluating its possibilities and goals. In order to make investment decision company should check liquidity, solvency and profitability ratios, development perspectives. It will help to choose suitable risk level and strategy. In addition, companies should pay attention on managers behavior that can be affected by different factors that may result in investment inefficiency. Therefore, all the decisions should be made by the board of managers considering their knowledge and competence. |
