Determinants of equity share prices evidence from American firms

The purpose of this study is to find variables that explain the variance of equity share prices in America. A sample of 333 American firms listed on New York Stock Exchange (NYSE), USA for a period of 3 years (from 2009-2011) was selected. This study applied co-relational and non-experimental research design. The overall findings of this study show that book value per share, earnings per share, dividend per share, price-earnings ratio, the CEO duality, and the internationality of the firm explain the variance of equity share prices in America. The study separated manufacturing firms from service industry firms and found that similar variables explain the share price variance. This study contributes to the literature on the variables that explain variance of equity share prices. The findings may be useful for the investment managers, financial managers, investors, and stock investment/financial management consultants.