The Impact of Business Life Cycle on the Earnings Persistence of OBM and OEM Firms

• Main Authors: Hsuan Lin, 林瑄
• Other Authors: 陳俊合
• Format: Others
• Language: zh-TW
• Published: 2013
• Online Access: http://ndltd.ncl.edu.tw/handle/42p7k8

碩士 === 國立中興大學 === 會計學研究所 === 101 === As the transition of the economy in Taiwan, the OEM industry which built the national economy decreased its profits day by day. Accordingly, this situation stimulates the enterprise to establish a brand and to create values added. There is so many brands stand out conspicuously in the world, however, could this method maintain the earnings efficiently and stable the earnings persistence? That’s the main question to think about. Therefore, the following is going to focus on the earnings persistence between the OBM and the OEM firms. In the meantime, with the conception of the business life cycle, this paper tries to discuss the different earnings persistence and observe the dissimilarity between the OBM and the OEM firms in each life cycle phase. This paper use Taiwanese listed companies as the sample from 2007 to 2011. This paper use Sloan (1996) model to estimate the earnings persistence, and employ the Anthony and Ramesh’s (1992) method to divide sample to different corporate life cycle stage. First, the empirical results show that the earnings persistence of the OBM firms is better than the OEM firms in Taiwan. Second, after considering the life-cycle factors, the earnings persistence of the OBM firms are better than the OEM firms in the growth, maturity and recession stage. Third, for OBM firms, the earnings persistence of growth are more persistence than recession stage, but the earnings persistence of mature companies are not significant greater than the growth and recessional companies. Finally, for OEM firms, the earnings persistence of maturity stage are greater than growth and recession stage, but the earnings persistence are no significant different between mature and recession stage.