An empirical framework of financial characteristics and outperformance in troubled economic times Evidence from the restaurant industry

    Authors

    N. Hua; Q. Xiao;E. Yost

    Comments

    Authors: contact us about adding a copy of your work at STARS@ucf.edu

    Abbreviated Journal Title

    Int. J. Contemp. Hosp. Manag.

    Keywords

    United States of America; National economy; Financial performance; Restaurants; Financial outperformance; Economic downturns; CORPORATE CASH HOLDINGS; COMPARATIVE ADVANTAGE; HOTEL PERFORMANCE; RETURNS; RISK; STANDARDIZATION; DETERMINANTS; MANAGEMENT; EQUITY; Hospitality, Leisure, Sport & Tourism; Management

    Abstract

    Purpose The purpose of this paper is to explore the financial characteristics associated with outperformance of US public restaurant firms in challenging economic times and the empirical measure of outperformance proposed herein. Design/methodology/approach - This study utilizes a Logit model and considers the relevant financial variables in annual deviation forms to explore an empirical model that explains financial outperformance in troubled economic times for the restaurant industry. Findings - The results of the study indicate that larger market share, asset turnover, and profit margin, combined with lower leverage, BM, earnings variance, and size, in addition to franchise utilization, appear to produce collectively a fine balance for success in difficult economic times. Research limitations/implications - This paper does not address the fine balance between short-term financial performance and long-term sustainability. Further, the employed contemporaneous modeling framework may limit generality of findings of this paper. Originality/value - This study provides systematic evidence on an empirical framework linking financial characteristics and outperformance of restaurant firms in difficult economic times. Its results have timely and significant implications for practitioners, researchers and other parties of interest.

    Journal Title

    International Journal of Contemporary Hospitality Management

    Volume

    25

    Issue/Number

    6

    Publication Date

    1-1-2013

    Document Type

    Article

    Language

    English

    First Page

    945

    Last Page

    964

    WOS Identifier

    WOS:000323807200009

    ISSN

    0959-6119

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