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Stock prices of German internet companies in 2000

  • This paper looks at the value-relevance of accounting data and measures of web-traffic for Internet firms listed on the Neuer Markt. In particular, the objective is to identify value drivers during the period from October 1999 to May 2000. In doing so, the study attempts to contribute to the understanding of the investment behaviour of market participants during that time, in a market environment characterised by rapid technological change and growth. The study subdivides Internet companies into Ecommerce and Enabler firms and analyses the value-relevance accordingly. It emerged that, across both samples, no significant value-relevance of traditionally applied financial valuation metrics such as earnings and cashflow could be evidenced. However, a positive association of total sales with market capitalisation can be shown for both samples, and in addition, sales and marketing expenses (Ecommerce) as well as research and development costs (Enabler) can also be identified as value drivers. Furthermore, the paper finds a number of webmetrics to be highly value-relevant and positively associated with market capitalisation, viz. customer loyalty, reach, page impressions and unique visitors. Combining and comparing the information content and value-relevance supports the notion that webmetrics, which are not part of standardised reporting regulations, did provide at least as much explanatory power for variations in market value as standardised accounting data.

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Metadaten
Author:Andreas Trautwein, Sven Vorstius
URN:urn:nbn:de:hbz:992-opus4-5993
Subtitle (English):an empirical investigation of value drivers on the Neuer Markt
Series (Serial Number):WHU-Forschungspapier (080)
Publisher:WHU Otto Beisheim Graduate School of Management
Place of publication:Vallendar/Rhein
Document Type:Working Paper
Language:English
Date of Publication (online):2018/03/29
Date of first Publication:2001/11/01
Release Date:2018/03/29
Tag:Deutschland; Empirische Analyse; Internet; Neuer Markt <Börse>; Webometrie; Wertanalyse
Empirical analysis; Germany; Internet; Neuer Marks <Stock exchange>; Value analysis; Webometrics
Page Number:40
Institutes:WHU Management Group / Lehrstuhl für Betriebswirtschaftslehre, insbesondere Controlling und Telekommunikation
Licence (German):Copyright for this publication