Open AccessStability Of Excellence: Revealed Patterns In Tobins q-Ratios
Author(s) -
Manuel L. Jose,
Carol Lancaster,
Jerry L. Stevens
Publication year - 2011
Publication title -
journal of applied business research
Language(s) - English
Resource type - Journals
eISSN - 2157-8834
pISSN - 0892-7626
DOI - 10.19030/jabr.v12i2.5829
Subject(s) - excellence , valuation (finance) , sample (material) , asset (computer security) , accounting , actuarial science , business , economics , marketing , econometrics , computer science , political science , chemistry , computer security , chromatography , law
Much has been written about characteristics of excellent firms, but little attention has been given to the possibility that excellence, once attained, is the result of a random process. This study uses market valuation concepts to construct a single measure of the multiple dimensions of excellent asset management to test the stability of excellence for a large sample of firms over a 20-year period. The findings suggest that firms are unable to sustain excellence from year-to-year, but excellence is maintained over longer run holding periods. The results also help explain findings in other studies where excellent firms have subsequently provided low rates of return to investors.