Impact of Investment in Intangible Assets, Financial Performance and Financial Policy on the Market Price of Public Shareholding Companies Listed in the Palestinian Securities Exchange

Abstract

This study aimed at testing the effect of investment in intangible assets, financial performance and financial policy on the firm value. The study was applied on a sample of 34 Palestinian corporations listed in the Palestinian Security Exchange during the period (2006-2014). In order to achieve the study objectives, multiple regression analysis and path analysis were used to clarify the relationship between the study variables. The results of the study showed that Palestinian corporations within the industrial sector scored the highest average of investment in intangible assets, while corporations within the investment sector didn’t invest in intangible assets. Investment in intangible assets, corporate performance (measured by current ratio, return on assets (ROA) and asset turnover) and financial policy (measured by debt to equity ratio and dividend ratio) have significant effects on the market value of the corporations listed in the Palestinian Security Exchange. The study recommends that Palestinian corporations should increase investment in intangible assets, especially in information technology, research and development and training and qualification of employees in order to strengthen their financial position and increase their market value