2010 Vol. 4 Num. 1 - GCG: Revista de Globalización, Competitividad ...
2010 Vol. 4 Num. 1 - GCG: Revista de Globalización, Competitividad ...
2010 Vol. 4 Num. 1 - GCG: Revista de Globalización, Competitividad ...
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Tiago Loncan and Walter Meucci Nique<br />
to start a similar business from the ground, meanwhile above 1 ratios tend to be associated<br />
with market overvaluation. Companies seem to be operating on an equilibrium frontier.<br />
45<br />
Embraer had the highest Q in the sample, reaching 1,76 in the year 2000. This result is consistent<br />
with financial theory, as Embraer is in a higher ad<strong>de</strong>d-value business, when compared<br />
to the other companies in the sample. So investors should put more future expectations<br />
on that company.<br />
Return on Assets (ROA) is low for the sample, accounting 0,068 (6,8%). It shows the somewhat<br />
inefficient <strong>de</strong>ployment of firms’ assets. It can be associated to the commodity characteristics<br />
of sample: besi<strong>de</strong>s Embraer, the rest of the firms analyzed are in commodity<br />
businesses.<br />
The high standard <strong>de</strong>viation observed for the three variables must be highlighted: there is<br />
consi<strong>de</strong>rable heterogeneity between firms in the sample (Hair et al. 1998).<br />
4.2. Correlations and OLS regressions: Aggregate analysis<br />
The comparison between ROA and FSTS is showed in the graph below:<br />
Graph 1: ROA and FSTS<br />
<strong>GCG</strong> GEORGETOWN UNIVERSITY - UNIVERSIA <strong>2010</strong> VOL. 4 NUM. 1 ISSN: 1988-7116