VALUE RELEVANCE OF ACCOUNTING INFORMATION AND STOCK MARKET PERFORMANCE

ABSTRACT

This study examined the value relevance of accounting information and stock market performance. This study made use of secondary data, spanning from 2019-2022. The data used were sourced from the companies annual reports. Descriptive statistics, Pearson correlation coefficient and Ordinary Least Square regression analysis were employed. It found that earnings have a positive and insignificant relationship with market capitalization, cashflows have a positive and significant relationship with market capitalization, dividends have a positive and significant relationship with market capitalization and book value have a positive and significant relationship with market capitalization. The study recommends that investors be rational and employ the use of accounting information in their investment decision process before making any financial commitment. It also recommends that management act in the best interest of the shareholders they are meant to serve.