Kirill Angel, Carlota Menéndez-Plans and Neus Orgaz-Guerrero
This paper aims to study the connection between the systematic equity risk of US tourism industry companies and a set of information from inside these firms and the market. The…
Abstract
Purpose
This paper aims to study the connection between the systematic equity risk of US tourism industry companies and a set of information from inside these firms and the market. The authors sought to identify which information explains equity risk to estimate patterns of behavior – especially for those companies that cannot have a beta – in terms of the cost of share capital.
Design/methodology/approach
To carry out the research, the authors used a panel data technique and combined accounting information from the selected companies with macroeconomic information to develop independent variables. The sample consisted of 79 firms of the arts, entertainment and recreation and accommodation and food services sectors in the USA for 2004-2013. The authors incorporated two dummy variables into the analyses. The first one was used to find out if a difference exists between the two sectors, and the other was used to examine differences before and after 2008, when the current economic and financial crisis began.
Findings
The results reveal that equity risk is explained by businesses’ size and growth, along with three indicators of business efficiency, consumer price and Stoxx Europe 50 indices. The 2008 financial crisis did not alter the behavior of the estimated model, and no difference was found between the two sectors in question.
Research limitations/implications
The study’s most important limitation is the number of companies and years that make up the sample, although a broader set of data was analyzed in this work compared to previous studies.
Practical implications
The research results are quite useful to tourism enterprise management in the US market as they provide information that explains companies’ equity risk. Knowing this information could facilitate more efficient management, and an understanding of which information determines company risk can help to quantify risk objectively without access to betas.
Originality/value
The authors studied the US market as an important financial market and the tourist industry, in particular, for its economic significance, as shown by the direct contribution of travel and tourism to the US gross domestic product. Although this type of research in the tourism sector is not new, the present study answers the need identified by Park and Jang (2014) to continue this line of research by using a more interdisciplinary approach that combines hospitality research with finance and/or accounting studies.
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While the web was meant to broaden our horizons, the opposite has happened. Social media filter bubbles, a fragmented news landscape and the drive to personalization have all but…
Abstract
While the web was meant to broaden our horizons, the opposite has happened. Social media filter bubbles, a fragmented news landscape and the drive to personalization have all but insulated and polarized us. The Perspective seeks to counter the growing polarization taking hold all over the world as amplified in the case of Brexit, the 2016 US presidential election and more.
The Perspective is a global enterprise, defined by its mission of opening minds this by displaying two sides of current events. The psychological insights gathered were translated into de-facto design choices and editorial guidelines. The Perspective won the 2017 Eppy and WebAward and it is also a highly commended finalist of The 2018 Drum award and a Webby award nominee (www.theperspective.com).
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Chitra Singla, Shridhar Sethuram and Sanjay Kumar Jena
The case on Moodcafe captures the journey of the start-up and its entrepreneurs from the beginning till the fund-raising stage. The case brings forth critical decisions that each…
Abstract
The case on Moodcafe captures the journey of the start-up and its entrepreneurs from the beginning till the fund-raising stage. The case brings forth critical decisions that each entrepreneur or the team of co-founders have to address during their start-up journey. This short case gives opportunity to delve into two aspects mainly a) As a founder, which investor should one choose for seeking funds and what should be the terms and conditions of investment? and b) How can one review and assess the business model of a start-up?
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