The effect of advertising on stock returns: Evidence from selected public companies in the Philippines

• Main Authors: Cruz, Marco Angelo, Leong, Christine, Yap, Leandro Angelo
• Format: text
• Language: English
• Published: Animo Repository 2015
• Subjects: Stock exchanges > Philippines; Advertising, Industrial > Philippines; Finance and Financial Management
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/18376
• Institution: De La Salle University

The study aims to identify the effect of advertising on stock returns in the Philippines, using data from 32 publicly listed companies in the Philippines. Along with advertising expense, the researchers used total assets, sales, and capital expenditures as independent variables. Control variables such as market capitalization, firm age, and book-to-market ratio were also used in the study. The data used by the researchers were gathered from the annual reports of the companies from 2004-2012 via the Philippine Stock Exchange (PSE) Library and Osiris. The researchers used Fama-Macbeth regression to examine the effect of the independent variables on stock returns. Additional research was done on the short-term effect of advertising expense by regressing quarterly data. Results show that the independent variables used in the study had no significant relationship with stock returns, even when the control variables were included in the model. Chapter 1 contains the background of the study, statement of the problem, objectives, statement of the hypotheses and the limitations of the study. Chapter 2 contains the related literature which the researchers will use throughout the study as well as the literature map and the research gap. Chapter 3 contains the frameworks used to provide a sound base for the study. Chapter 4 contains the research and sampling design, method of data collection, description of the variables used, data analysis method, and the methodological limitations. Chapter 5 contains the results of the regression as well as data interpretation. Chapter 6 contains the conclusion and recommendations.