Analysis of Internal Financial Factors Affecting Stock Price in Airline Businesses

Along with the supply-demand effect, factors such as the economic situation of the country, future expectations and the performance of the enterprises are quite effective in determining the stock price. In this context, it is aimed to reveal the relationship between the internal financial factors of airline businesses and the stock price. In practice, the annual internal data of 28 airline businesses covering the years 2005-2018 were analyzed using panel data and panel VAR analysis methods, and the internal (TA, FL, ATR, OPM and BV) factors that determine the stock price were determined. As a result of the panel data analysis applied, it was determined that the total assets variable had a positive effect on stock prices, while the financial leverage variable had a negative effect. According to the panel VAR causality results, bidirectional causality between the total asset variable and the stock price, one-way causality between the beta value and acid-test ratio variables and the stock price was determined. In summary, airlines can increase their stock value by taking advantage of economies of scale, optimizing the liquidity situation, and taking into account the negative impact of financial leverage. internal factors and studied the dynamic relationships between stock prices, liquidity status (acid-test ratio), firm size (total assets), profitability (operating profit margin), financial leverage, and beta value. A model was established by taking the logarithms of all variables. First, estimations were made with panel data analysis, and then dynamic relationships were examined with Panel VAR analysis. As in all time-series analyses, firstly cross-sectional dependence and unit root tests are performed to determine whether the series are stationary or not. A cross-sectional dependence test was performed to determine whether there is a cross-sectional dependence in the variables in the model. In the case of cross-sectional dependence in series, it is