Emprical Analysis Of The Earnings Persistence In Sme Stock Market

It marked the coming of the new era of the growth of the SMEs which is nurturing by the capital market in China and it had a very important significance to build a multi-level capital market since the SMEs board was launched officially in May 17,2004. The SMEs board has been a rapid development from that time.But most of the operating results of the year listed of the companies was significantly lower than the results of the one year or a few years before the year listed. It's difficult to maintain the level of performance of years before, and the operating results after the companies being the listed companies dropped significantly. The poor earnings persistence in the SME stock market affected the healthy development of securities market in China.The paper reveals the unsatisfactory earnings persistence of the SMEs board by positive study from the angle of the company's industry,geography,major shareholder equity ratio,issue size,earings composition and profitability of non-recurring gains.The the paper analyzes the influence factors of the poor earnings persistence. According to statistical analysis and empirical analysis, relevant recommendations have been made in the paper.Through the overall and group statistical description and empirical analysis of the SMEs board, we concluded that:the profitability has declined year by year from the one year before it became public to the second year after the year listed, and the average profitability after the companies went public was lower significantly than the profitability.The poor earnings persistence is affected by the company's industry,issue size,earings composition and profitability of non-recurring gains.It helps the government regulators assessing the sustainability of corporate profits and making relevant regulatory policies.It provides useful information for the majority of investors to identify the sustainability of profits of listed companies to promote the health of listed companies and the development of the securities marketThis paper centers on the above topic by combining theory with practice and combining normative and positive research.Icon analysis,graphic method and multiple regression model have been applied to the empirical analysis.