THE EFFECT OF FIRM GROWTH OPPORTUNITIES AND EARNINGS PERMANENCE ON THE FREE CASH FLOW RETURNS AT PETROLEUM INDUSTRY IN IRAN

Abstract

The purpose of this paper is to document empirically the effect of firm growth opportunities and earnings permanence on the free cash flow returns. The population of this study are the companies that active in Petroleum industry in Iran since 2007 and had this characteristics: (1) Fiscal year is end March 19, (2) During the years 2007 to 2013 be presented annual Audited financial statements (3) Companies has accepted in Tehran stoke Exchange since 2006 and (4) Final sample from 2007 to 2013. With considering this situation, 47 companies were selected as sample. The sampling method of this study is probability - simple random sampling. Data has gathered from www.rdis.ir and www.irbourse.com. In order to analyze the data, we used deductive and descriptive statistical methods. The results K-S Test shows the test distribution is Normal. So we can use Multi Regression to test the hypothesis of the research. The findings show that growth opportunities has impact on free cash flow returns and earnings permanence has not impact on free cash flow returns.