Investigation of Financial Factors Affecting the Growth of Listed Companies

Considering the importance of firm growth and the factors that influence it, the present study investigates the effect of financial factors on the growth of listed companies in the Tehran Stock Exchange in the period 2015 to 2018, and the book value to market value ratio used as a growth indicator of the companies. The statistical sample of this research is 433 companies listed on the stock exchange from 2015 to 2018. By the systematic elimination, only 82 companies were identified as eligible for our sample. Before analyzing the data, the variables' reliability tests and Chau and Hausman's tests were performed to determine the appropriate model for estimating the parameters and the effect of the independent variables on the dependent variable. Then, the panel data model with the fixed effects is used to test the hypotheses. As the results of the study show, there is a significant and direct relationship between cash flow, profitability, market share, industry sales, and financial leverage with companies' growth opportunities. Also, there is no significant relationship between the age and size of the companies and their growth opportunities.