The Research On The Relationship Among Cash Flow Volatility,Industry Competition And Enterprise Value

In the traditional enterprise value assessment and investment analysis,most of the investors use the evaluation system based on financial indicators and profit indicators.However,in the financial crisis in 2008,many companies with excellent financial indicators accidentally fell into the trap.Business dilemmas,such as giants,Bahrain Bank,Deron and other large companies exper:ienced a breakdown of capital flows,making it difficult for companies to maintain operations or even declare bankruptcy.The emergence of the above cases led to the rethinking of the financial indicators evaluation system by researchers in the professional field.Later,the concept of cash flow gradually attracted the attention of scholars and applied more to the enterprise financial management and risk management module.First of all,cash flow is the basis for the continuous operation of enterprises.Business activities,investment and financing activities are inseparable from cash flow.The stability of cash flow is related to the basic operation of enterprises.Secondly,unlike other financial indicators,cash flow is accompanied.The business is happening and dynamic,and the cash payment system also makes the cash flow indicators have some unique characteristics.Finally,there are many earnings management behaviors in listed companies,and the profit indicators can not truly reflect the operating efficiency of the enterprises.The cash flow movement is transferred with the business.The most difficult parameters for enterprises to adjust and manipulate,so the cash flow evaluation can reflect the true market value of the company.Based on the perspective of enterprise risk management and based on the theory of capital value and economic plunder,this paper selects the non-financial listed companies in Shanghai and Shenzhen from 2009 to 2017 as a research sample,and describes the cash flow by describing statistics and multiple regression.Empirical research on the relationship between cash volatility,industry competition and enterprise value,and further explore the transmission path.The results show that cash flow volatility is significantly negatively correlated with enterprise value;industry competitive intensity and the competitive position of enterprise have a positive adjustment effect on the relationship between cash flow volatility and enterprise value,that is,the fiercer competition in the industry and the higher the competitive position of the enterprise,the greater the negative impact of cash flow volatility the last is to explore the transmission path of cash flow volatility affecting corporate value,and find that cash flow volatility have a negative impact on enterprise value by increasing the cost of equity capital.On the basis of the above conclusions,this paper proposes targeted recommendations from the perspectives of business managers,investors and market regulators,hoping to provide reference and help for enterprise development.