Determinants of profitability - A case study of oil and gas firms listed on Vietnam stock market
Abstract
The main objective of this study is to find out the potential impact of firm-specific
factors and macroeconomic factors on profitability of oil and gas companies listed on
the Vietnam Stock Exchange. This study uses panel data analysis techniques to
investigate the determinants of profitability of 18 listed firms for 6 years period from
2009 to 2014. Secondary data used in this paper is obtained from various sources. The
results reveal that profit margin, assets turnover ratio and firm size have positive and
significant relationship with ROE and ROA. Leverage has strong negative impact on
ROE and ROA. Current ratio has negative and insignificant relationship with ROE
but positive and significant relationship with ROA. GDP growth and inflation rate
have positive and insignificant relationship with ROE but strongly positive impact on
ROA. Profitability is negatively affected by exchange rate fluctuation. Oil price
fluctuation and sales growth have positive but insignificant relationship with ROE and
ROA.