Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/266891 
Authors: 
Year of Publication: 
2022
Citation: 
[Journal:] Financial Internet Quarterly [ISSN:] 2719-3454 [Volume:] 18 [Issue:] 1 [Publisher:] Sciendo [Place:] Warsaw [Year:] 2022 [Pages:] 66-73
Publisher: 
Sciendo, Warsaw
Abstract: 
This study attempts to predict high growth firm (HGF) status with financial ratios. Measures related to the firm's effectiveness in using assets to generate profits, EBITDA margin, debt ratio, equity-to-debt ratio and return on assets are associated with HGF status. While the financial ratios improve HGF prediction, prediction remains modest (AUC = 0.627). This study suggests it is difficult to assume a very good HGF forecast from only financial ratios; therefore, the recommendation for researchers and policymakers building models for predicting HGFs is to incorporate non-financial ratio variables, like the intangible innovation and team-related variables. Finally, study suggests a standardized reporting of prediction performance metrics in the out-of-sample and out-of-time simulation for HGF prediction studies.
Subjects: 
high growth firms
prediction
financial ratios
JEL: 
L1
M21
C53
G3
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Article

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