Salmi, Timo; Virtanen, Ilkka; Yli-Olli, Paavo - Sci.Finance.Abstract
Factor and transformation analysis are used to find stable categories of financial ratios, and to test hypotheses concerning accrual ratios, cash flow ratios, and market-based ratios. Six stable factors are observed for Finnish data covering 1974-84. Contrary to expectations market-based ratios...