On the bankruptcy of internet companies: An empirical inquiry |
| |
Institution: | 1. Università della Valle d''Aosta (University of Valle d''Aosta), Dipartimento di Scienze Umane Strada Cappuccini 2° A, 11100 Aosta, Italy;2. Manchester Metropolitan University, Faculty of Health, Psychology & Social Care, Birley Building Bonsall Street, Manchester M15 6GX, UK |
| |
Abstract: | In this paper we investigate bankruptcy of Internet (dotcoms) companies. Using a calendar-time model, we identify three key predictors of company failure; net income to total assets, cash flow to total liabilities, and total assets. In addition, we use an event-time model and find that liquidity becomes more important as a predictor than profit potential about one year prior to the failure, but that this finding is reversed (i.e. liquidity is less important than profit potential) three years prior to bankruptcy. Our results also suggest that three years prior to bankruptcy, a higher ratio of total liabilities to total assets is associated with lower odds of survival. |
| |
Keywords: | |
本文献已被 ScienceDirect 等数据库收录! |
|