EFFECT OF DEBT FINANCING ON EARNINGS PER SHARE OF LISTED MANUFACTURING FIRMS IN NIGERIA

https://doi.org/10.5281/zenodo.12931970

Authors

  • Eke Robert I .Ph.D. FCA1 Department of Accounting and Finance, School of Social and Management Sciences, Wellspring University Benin City, Edo State.
  • Ofuebe Kingsley Chukwunwike Department of Accounting and Finance, School of Social and Management Sciences, Wellspring University Benin City, Edo State.
  • Hilary Temofeh Kanwanye. Department of Economics, School of Social and Management Sciences, Wellspring University Benin City, Edo State.

Keywords:

Debt financing, earnings per share, manufacturing firms, Nigeria

Abstract

This study investigates the impact of debt financing on earnings per share (EPS) among listed manufacturing firms in Nigeria. It employs total debt ratio, short-term debt ratio, and long-term debt ratio as proxies for measuring debt financing. Secondary data sourced from annual reports and accounts of 21 listed manufacturing forms from 2012 through 2022 were analysed using Panel Least Square (PLS) regression technique. The empirical findings reveal a significant positive relationship between total debt ratio and EPS, contrasting with an inverse relationship observed between short-term debt ratio, long-term debt ratio, and EPS. The study recommends that firms adopt strategies emphasizing low-cost operations to minimize borrowing, thereby reducing dependence on debt. Instead, leveraging retained earnings and exploring alternative low-cost financing options for investment purposes is encouraged

Published

2024-07-26

How to Cite

Eke , R. I., Ofuebe , K. C., & Kanwanye, H. T. (2024). EFFECT OF DEBT FINANCING ON EARNINGS PER SHARE OF LISTED MANUFACTURING FIRMS IN NIGERIA. SADI International Journal of Management and Accounting (SIJMA), 11(3), 43–52. https://doi.org/10.5281/zenodo.12931970

Issue

Vol. 11 No. 3 (2024): July-September

Section

Original Peer Review Articles
Copyright & Licensing

Copyright (c) 2024 SADI International Journal of Management and Accounting (SIJMA)

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

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