What is it about?
The study examines the determinants of value creation for the world’s largest oil and gas companies. The empirical analysis finds that dividend policy and cost efficiency are important determinants of valuation of oil companies. The higher the liquidity position of the energy firms, the higher is the value creation in the market.
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Why is it important?
The study suggests that market is skeptical about high capital expenditures by oil and gas firms. Focus on effective asset utilization is important for value creation in energy sector.
Perspectives
Examination of determinants of value creation is a relevant and interesting topic for discussion
Prof Rajesh Kumar
Institute if Management Technology Dubai
Read the Original
This page is a summary of: An empirical study on the valuation of oil companies, OPEC Energy Review, March 2016, Wiley,
DOI: 10.1111/opec.12064.
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