VALUE BASED DETERMINANTS OF MARKET PERFORMANCE OF LISTED COMPANIES IN NIGERIA: A DYNAMIC APPROACH

1 VALUE BASED DETERMINANTS OF MARKET PERFORMANCE OF LISTED COMPANIES IN NIGERIA: A DYNAMIC APPROACH BY USMAN Tanimu Gadi, Ph.D. Department of Accounting, Taraba State University, Jalingo ABBDULKARIM Shaibu Alhassan, Ph.D. Department of Accounting, Nasarawa State University, Keffi TERU, Susan Peter, Ph.D. Department of Accounting, University of Abuja ABSTRACT The study examined value-based determinants of the market performance of listed companies in Nigeria from 2013-2022. The study adopted signaling theory and longitudinal research design with a sample size of one hundred and thirteen (113) companies, which was drawn from the population of one hundred and sixty-four (164) listed companies on the Nigeria Exchange Group as of December 2022. Data were collected from the annual report of the sampled companies and a System Based Generalized Method of Moments (GMM) estimator was used for the analysis. The result indicated that market value-added, economic value-added, and refined economic valueadded have positive and significant effects on market performance. The study suggests among others, that investors should consider the value-based determinants of a company's performance and competitive advantage. This involves assessing the company's ability to generate income higher than the cost of capital, which is a fundamental aspect of value creation and sustainable growth. Keywords: Value-Based, Market Performance, Dynamic Approach 1.0 Introduction Corporate organisations exist for the sole reason of creating value for stakeholders, especially for shareholders. In recent years, we have seen more and more pressure on the boards of companies to show a rise in the value of their company. The expectation of the investors toward their capital invested in a company is to gain as much return as possible at a certain level of risk. The return on investment may come from periodic payments (such as dividends or interest) or an increase (decrease) in the price of securities (stocks and long-term debt securities), which can provide gains 2 (losses) for investors. Hence, investors need various kinds of information so that they can assess the performance of the company (Andhika & Yunita, 2016). One of the primary ways that companies communicate their financial performance to investors is through accounting information. These provide information on a company's revenue, expenses, and net income. If a company's earnings exceed market expectations, its stock price may increase as investors become more confident in the company's future prospects. On the other hand, if a company's earnings fall short of expectations, its stock price may decline. According to Arifin (2007), stock price shift can be affected by many factors including internal and external factors which can be in form of the company’s fundamental and outside the area of the company itself. Therefore, this market value of shares is influenced by number of factors, which can be companyspecific or industry-specific. The traditional accounting indicators as well as the market-based indicators such as market value added, economic value added and refined economic value added are considered essential tools for evaluating the operational and financial performance of companies (Hirsch, 2000). Economic value-added is the performance measure most directly linked to the creation of shareholders' wealth over time. More explicitly, the economic value-added measure gives importance to how much economic value is added to the shareholders' interests by the management of the company with which they have been entrusted. Economic value-added provides a reliable year-to-year indicator of value-based performance with the main goal of creating shareholder value (Stewart, 1991). Therefore, when the company's post-tax net operating profit exceeds the total capital cost of the investment, the economic value added is positive, and the value created by the company brings about an increase in the shareholder's wealth (Sabol & Sverer, 2017). Positive economic value added indicates that the company’s management managed to increase enterprise value for company owners in accordance with the objective of maximizing corporate value (Mamun & Mansor, 2012). Company with a high economic value added may be seen as more attractive to investors, which could lead to an increase in its market performance. On the other hand, a company with a low economic value added may be seen as less attractive to investors, which could lead to a decrease in its market performance. Market value added measures the investors' expectations for the total value they expect the company to create over the total capital invested. The greater the market value-added, the better it is. The negative market value added means that the value of investments generated by the 3 company’s management is less than the financial capital submitted to the company by the capital markets, which means that wealth has not been created (Brigham & Houston, 2010). High refined economic value added indicates that a company is generating strong profits for its shareholders and creating value for them. This can be attractive to investors, as it suggests that the company is well-managed and has a strong competitive advantage. As a result, a high refined economic value added may lead to an increase in a company's stock price. On the other hand, a low refined economic value added may indicate that a company is struggling to create value for its shareholders, which could be a red flag for investors. This may lead to a decline in the company's stock price. Furthermore, the price level also encompasses price history (past share prices), as there are intermediate-term inertia patterns in stock returns, with stocks that have done well (poorly) in the previous six to 12 months having good (poor) future prospects (Haugen & Baker, 1996). Also, if a stock went up significantly in price last month, this could signal a short-term setback for the next month due to price pressure induced by investors who are attempting to buy or sell a large amount of a particular stock quickly (Jagadeesh, 1990). Therefore, the trend in the previous share price of the company stands a chance of affecting the current share price. Despite the growing interest in the Nigerian stock market and the increasing number of listed companies, there remains a lack of comprehensive understanding regarding the value-based determinants of market performance in the Nigerian context. While traditional financial metrics such as earnings per share and return on equity are commonly used to assess company performance, there is limited research focusing on value-based determinants and their influence on market performance. Also, to the extent of the literature review, only the study of Rahman and Mustafa (2013) in the US that adopted dynamic analysis of value-based determinants of stock prices, despite their significance in affecting the company's current share prices. The dynamic approach is necessary when selecting measures, or a set of measures, to represent organizational performance, because it considers the time lag in the variables and the effects generated in the dependent measures. It is based on this backdrop that this study assessed how the dynamics of market performance are impacted by value-based determinants within listed companies in Nigeria. Specifically, the study examined effect of market value added, economic value added and refined economic value added on market performance of listed companies in Nigeria. 4 The remaining sections of the study covers the literature review, methodology, result and discussion and, conclusion and recommendations. 2.0 Literature Review Market Value Added Market Value Added (MVA) is a reflection of investors' expectations on the total value they expect from the company to create future value of the total capital invested less in the company. The greater the Market Value Added, the better it is. The negative Market Value Added means that the value of investments run by the capital management is less than financial capital submitted to the company by the capital markets, which means that wealth has been destroyed (Brigham & Houston, 2010). According to Steward (2013), Market Value Added (MVA) is defined as an estimate of the company's market value for total obligation and capital capitalization. In order to estimate this market value, book value-form, total obligation added to actual market value form share value. The market value-added calculates the differences between market value (debt and capital) and the amount of capital invested. The MVA explains the value added to a particular equity share over its book value. It informs how much value has been added to the economic value of the shareholders. The MVA is the difference between the total market value of a firm and the economic capital. A firm's total market value is equal to the sum of the market value of its equity and debt. The Market Value Added can be defined as the difference between the market value of a company's equity and book value as presented in the balance sheet, market value is calculated by multiplying the share price by the number of shares outstanding (Brigham & Houston, 2010). Economic Value Added Measure of economic added value (EVA) has been proposed in 1982 by Stern Stewart Institute. This is an innovative way to find the true value of companies and executives which reflects the organization's internal performance (Talebnia, et al., 2012). The uses of EVA have shown high interest by corporate managers and business peoples in recent years. As stated by Lehn and 5 Makhija (1997), EVA provides the most appropriate and reliable year-to-year indicator of marketbased performance with the main goal of creating shareholder’s value (Stewart, 1991). Economic Value Added (EVA) refers to the difference between the net profit after tax of the enterprise and the total cost of capital invested in the operation of the enterprise during a certain period (Sabol & Sverer, 2017). It is an extension of residual income and economic profit, which represents the ability of enterprise value creation (Sharma & Kumar, 2010). When the company's post-tax net operating profit exceeds the total capital cost of the investment, the EVA is positive, and the value created by the company brings about an increase in the shareholder's wealth (Sabol & Sverer, 2017). Conversely, if the EVA is negative, the company's operating income is not enough to cover all the capital costs, including debt capital and equity capital costs, resulting in a reduction in shareholder wealth (Mamun & Mansor, 2012). Economic Value Added (EVA) is an alternative approach as a measure of profitability that can measure managerial performance in a certain period. EVA provides a benchmark of how far the company has been adding value to shareholders within a year or period. EVA can be used at the level of division or corporation as a whole so that EVA can be used as a basis for compensation or evaluation basis for managers in managing the company (Kamaludin, 2011). EVA is positive if the return is higher than the return required by investors. In addition, negative Economic Value Added (EVA) indicates that the value of the company is reduced so that the resulting rate of return is lower than the rate of return demanded by investors, which means that the company failed to create value for the owners of capital (Young & O’Byrne, 2001). One of the major goals of EVA is to improve the efficiency of managers towards their firms through effective cost decision making. Due to EVA, managers are obliged to generate value for their shareholders or investors. Mäkeläinen and Roztocki (1998) mentioned that EVA shows the value for the capital used or utilized and judges the efficiency. The ability to control the operations is the main concern of EVA and plays a system of good compensation management that motivates managers to generate shareholder value. Economic value added is the company's goal to increase the value or the value-added of sunk capital shareholders in the company's operations. Therefore, Economic Value Added is the 6 difference between operating profit after tax (Net Operating Profit After Tax or NOPAT) and capital cost (Cost of Capital). According to Tandelilin (2010), economic value added is a measure of the success of the company's management to increase the value-added for the company. The assumption is if either or effective performance management (seen from the added value given), will be reflected in an increase in the company's stock price. Positive economic value-added indicates that the management company managed to increase enterprise value for company owners in accordance with the objective of financial management which is to maximize corporate value. Also, EVA not only more accurately measures the performance of a company but also predicts the market value of equity by adding the book value of equity with the present value of expected EVAs under the assumption of constant required return and constant return on equity (Stewart, 1991). A valuation model plays a vital role in determining the time of buying and selling investor securities. Fundamentally, analysts believe that intrinsic values, which aid in the process of borrowing, merging, and acquiring, determined by valuation models are the actual value of equity. Higher and lower intrinsic values indicate corporate performance. It is clear when compared economic value added with the traditional measuring instrument of ROE and ROA, that these measures ignore the cost of capital, making it difficult to know whether a company has created value or not. The cost of capital is determined based on the weighted average of the interest rate and the after-tax interest rate on equity capital (Weighted Average Cost of Capital, WACC), in accordance with the proportion of debt and equity in the capital structure of the company (Utama, 1997). Economic value added is a performance indicator that is reflected through the company's profits from the company after considering the cost of the invested capital. Economic value added is the result of a reduction in the total capital cost to operating profit after tax. The cost of equity capital can be either cost of debt and the cost of equity. Economic value added is able to calculate the true economic profit (true economic profit) of a company in a given year and are very different when compared to the accounting profit (Khaddafi & Heikal, 2014). Market Performance: Performance is the factor that most creditors, investors, managers, and other economic actors will be considered. Many decisions are based on companies' performance. 7 Corporate performance is a product of the activities and return on investment in a given period. Shares show the performance of the company hence, in this study it is paramount to conceptualized share. Shares are a sign of capital participation in a limited liability company as it is well known that the investor’s goal is to buy shares to earn income from those shares. The investors are categorized as investors and speculators. Investors here are people who buy shares to own companies in the hope of getting dividends and capital gains in the long run, whereas speculators are people who buy stocks for immediate resale if the exchange rate is considered the most profitable as it is known that the stock provides two kinds of income that is dividend and capital gains (Bustami & Heikal, 2019). According to Darmadji and Fakhruddin (2006), Stock (stock or share) can be defined as a sign of participation or ownership of a person or entity in a company or company limited. Share Price: A share price is the price of a single share of a company’s stock. Share prices in a publicly traded company are determined by market supply and demand. The share price is volatile because it largely depends upon the expectations of buyers and sellers (O’Hara, 2000). Shares (stock or share) can be defined as a sign of participation or ownership of a person or entity in a company or limited liability company. The portion of ownership is determined by how much investment is invested in the company (Darmadji & Fakhruddin, 2006). According to Anoraga (2001), the stock price is the money spent to obtain the proof of attachment or ownership of a company. Stock prices can also be interpreted as a price that is formed from the interaction of buyers and sellers of stock by the background of their expectations for corporate profits so that the investors need information relating to the formation of these stock in the decision to sell or buy stock. Empirical Review Ozhi (2000) investigated the effect of MVA on the share market price of 27 listed firms in Bombay Stock Exchange over 1997-1999. Stern Stewart Formula was used to determine MVA. The study reveals that neither MVA, nor the MVA per share has a significant effect on share prices. The model of the study is not fit thus, other variables can explain variation on share price better. Salehi, Valipour and Yousefi (2011) studied the association between value-based financial performance measures and value creation in Tehran Stock Exchange (TSE) using 92 companies based on a five- 8 year period from 2005–2009. Results indicated that there are strong associations between valuebased measures EVA, MVA and CVA and value creation. Salehi, Valipour and Yousefi (2011) studied was able to improve on the study of Ozhi, (2000) because it studied more variables compared to the prior study. Panigrahi (2017) investigated accounting and market performance measurement tools on shareholder’s wealth in the Malaysian public listed construction companies. The study used panel data analysis techniques, particularly Error Correction Models (ECM) to test the relationship of error terms and panel Ordinary Least Square (OLS) regression for the analysis over the period of 2003-2012. The result shows that earnings per share, economic value added (EVA) and dividend payout ratio have a significant effect on shareholders' wealth. Furthermore, market value added (MVA) is found to have a negative relationship with created shareholder value. The model of Panigrahi (2017) explained shareholder wealth better than the model of Salehi, Valipour and Yousefi (2011) and Ikbar and Dewi (2015) because it incorporates more determinants than the previous studies. Silitonga, Ramadhani and Nugroho (2018) analyzed the effect of economic value-added, market value-added, total assets turn over and price-earnings ratio on the stock returns. The multiple regression analysis was used to examine the effect from the sample of consumer goods sector listed on the Indonesia Stock Exchange from 2015 to 2017. The results of the study indicate total asset turnover (TATO) and price-earnings ratio (PER) have a significant effect on stock return whereas the other variable economics value-added and market value-added had insignificant on stock return. The study of Silitonga, Ramadhani and Nugroho (2018) has not met up with the empirical standard of Obeidat and Darkal (2018) despite the fact that they were conducted the same year. However, each study period is two years which is too short. Obeidat and Darkal (2018) investigated the effect of accounting and economic-based measures of performance on the share market value of the listed manufacturing firms at Abu Dhabi Stock Exchange over the period 2014-2016. Accounting based measures where earnings per share, return on assets and return on equity while the economic-based measures, where the market value-added, and the economic value-added. Using the multiple linear regression method in the analysis each of both groups of variables had been found affecting the share market value. Moreover, the study 9 found that grouping all measures in one group leads to more significant effect on share price, than individual separated groups. As additional unrelated analysis to hypotheses, when each measure, using the simple linear regression method is tested individually in its effect on the share market price, only the market value added found having a significant effect on share market value. Silitonga, et al., (2018) study has improved on prior study of Ikbar and Dewi (2015) but has failed to meet up with the study of Nakhaei (2014) because the study used fewer determinants of stock performance and it account to only 14% variation on stock return. Hajiabbasi, et al., (2012) investigated the association between the creation value measures and traditional measures to predict the stock return. The sample involved 76 companies listed in the TSE for the period of 2007 to 2011. The results revealed that there is no important association between value-based measures, such as EVA, REVA, MVA, shareholder value added (SVA), and cash value-added (CVA) with stock return (SR). Furthermore, the correlation between accounting measures, such as return on equity (ROE), EPS, and operational cash flow (OCF) with SR was not significant. Moreover, there was a significant positive correlation between SVC and SR. Furthermore, there was a significant negative relationship between ROA and SR. In general, the results indicated that SVC has more relationship with SR. The work of Hajiabbasi, et al (2012) was able to ascertain both accounting and value-based measures on stock return. From this study, none of the studies was able to capture such variable in their model even the study of Nakhaei, et al (2016) that was conducted after four years. Thus, the study was able to set standards empirically however, the study cannot reflect the realities between those determinants and stock performance as a current period. Nakhaei, et al., (2016) assessed the relative and incremental information content of refined economic value added (REVA) and traditional performance measures, such as net income (NI), net operational profit after tax (NOPAT), and earning per share (EPS). The study involves 395 nonfinancial companies listed in Bursa Malaysia over the period of 2002–2011. Pearson correlation coefficient and panel data single and multiple regression models were employed to analyze the data. The empirical results indicate that the relative information content of the REVA was not greater than that of NI and NOPAT to explain stock returns. NI and NOPAT were highly correlated with stock return compared to REVA. Additionally, the incremental information content test indicated that REVA makes some additional contribution to information content beyond the NI, 16 Refined Economic Value Added (REVA) is useful as a performance indicator that focuses on value creation, makes companies pay more attention to capital structure, and can be used to identify activities or projects that provide higher returns than the cost of capital. In REVA, the cost of capital is calculated based on the market value of capital, unlike in EVA, whose cost of capital is based on the book value of equity. The summarized result shows that refined economic value added has a minimum refined economic value added of N5,228, while the maximum is N32,888,114,000,000. Table 3: Correlation Result Variables (1) sp (2) mva (3) eva (4) reva (1) sp 1.000 (2) mva 0.061 1.000 (3) eva -0.017 -0.003 1.000 (4) reva 0.083 0.012 0.118 1.000 Source: Stata Output, 2023 The result shows that market value added has a positive relationship with market performance to the extent of 6.1%, while economic value added has a negative relationship with market performance to the extent of 1.7% (0.017). However, refined economic value added has a positive relationship with market performance to the extent of 8.3% (0.083). Table 4 Hansen Test for Autocorrelation / Serial Correlation Tests Value-Based Model Z value P. Value Arellano-Bond test AR(1) -2.67 0.008 Arellano-Bond test AR(2) -0.41 0.683 Chi2 P. Value Sargan test 39.25 0.151 Hansen test 23.44 0.075 Source: Stata Output, 2023 The Arellano-Bond result tests for serial autocorrelation in the data set. The result shows that the null hypothesis of the residual of the lag variable is not correlated since the observed p-value for 17 the Arellano-Bond test for AR(2) of 0.683 is greater than the 0.05 (5%) level of significance. Furthermore, the post-diagnostic tests of Sargan and Hansen check the validity of the instrument. The study concludes that the instrument of the model is valid since the p-values of the Sargan and Hansen tests is greater than 95% confidence levels (5% significance level). Table 5: Choice of the Model MODELS LAGGED VARIABLE POOLED OLS FIXED EFFECT FIRST DIFFERENCE Value-Based LSP Coefficient .0006751 .0002519 .0002483 Source: Stata Output, 2023 The coefficient of the lagged variable (.0002519) in the fixed effect model is lower than that of pooled OLS (.0006751), which suggests difference GMM, but comparing the first difference GMM coefficient (.0002483) to that of the fixed effect model, the study concludes that system GMM is most appropriate for this study since the coefficient of the lagged variable in the first difference GMM is lower than that of the fixed effect models. In this case, according to the Rule of Thumb by Bond (2001), difference GMM is downward biased and system GMM is most appropriate. Table 6: Value Based Determinant of Market Performance System Dynamic Panel-Data Estimation (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) VARIABLES MODEL1 OVERALL MODEL1 AGRIC MODEL1 CONG MODEL1 CONST MODEL1 CONS MODEL1 FINSER MODEL1 HEACR MODEL1 ICT MODEL1 INDGOODS MODEL1 NATRES MODEL1 OILGAS MODEL1 SERV L.sp 0.4528*** .4929*** .7912** 3.8503*** .4889*** 1.030*** 0.806*** 0.880*** 0.939*** 0.263*** 0.306*** 0.0894*** (0.0003) (0.0002) (0.0010) (0.0242) (0.0002) (0.146) (0.141) (0.128) (0.0834) (0.0814) (0.0457) (0.0198) (0.0000) (0) (1.0409) (0) (6.3311) (0) (6.7909) (0) (8.4208) (0) (0) Mva 0.0000*** 0*** 0 -0*** 0*** 0*** 7.0611*** -0 -0 -0 0 0*** (0.0000) (0) (0) (0) (0) (0) (0) (5.7311) (0) (0) (0) (0) Eva 0.0000** -0 0 0 -0 0*** 0 0 0*** -1.0810 -0 0 (0.0000) (0) (0) (0) (0) (0) (0) (0) (0) (1.0810) (0) (1.1610) Reva 0.0120*** 0.0125** -0.00410 0.0239 -0.00213 0.0475** 0.0186 0.00744 0.0286*** 0.00568*** 0.960*** 1.435** (0.00338) (0.00599) (0.0130) (0.0158) (0.00522) (0.0229) (0.0124) (0.0103) (0.00942) (0.00131) (0.256) (0.545) Constant 16.0231*** 2.641* 1.386** 9.896*** 29.25*** 1.601*** 1.278*** 1.743*** 8.174*** 4.114*** 21.57*** 1.442*** (1.9477) (1.547) (0.676) (2.913) (9.043) (0.310) (0.389) (0.473) (1.740) (0.997) (4.405) (0.195) Observations 1,130 50 50 60 150 310 60 70 100 40 80 160 Number of id 113 5 5 15 20 31 6 7 10 4 8 16 Standard errors in parentheses *** p<0.01, ** p<0.05, * p<0.1 Source: Stata Output, 2023 18 The study adopts sectoral analysis for the combined model to give a clear and comprehensive understanding of the accounting and value-based determinants in all the listed sectors; however, the test of hypotheses is based on the overall model. Dynamic panel model is adopted by the study since changes in company’s performance will affect the current market performance. It is expected that investors' behavior will change along with their previous performance. In all the sectors, previous performance has a significant positive effect on market performance. From the overall model, increase in the previous performance will increase current performance by 0.4528 coefficient. In the agricultural sector, increase previous performance will increase current performance by .4929. This is significant at less than 1% significance level. Market Value Added and Market Performance Market value added is a representation of value created by the actions and investments of a company's management. A high market value added is evidence that the value of management's actions and investments is greater than the value of the capital contributed by shareholders, whereas a low market value added means just the opposite. Positive market value added indicates that the company's management has succeeded in maximizing the company's shareholder wealth, but negative market value added shows poor performance from company management. The management of the company is not successful in maximizing shareholder wealth. The study found that market value added has a positive and significant effect on the market performance of listed companies in Nigeria. This signifies that an increase in the market value added of the listed companies will increase their market performance. This is due to the fact that investors always increase their investment where there is added value to their total capital invested. Thus, the greater the market value added, the better it is, and this will affect market performance positively; otherwise, it will affect market performance negatively. Based on the findings, the study rejects the hypothesis that market value added has no significant effect on the market performance of listed companies in Nigeria. Ozhi (2000), Salehi et al. (2011), Safitri (2013), Obeidat and Darkal (2018), Ikbar and Dewi (2015), and Shabib-ul-Hasan, et al. (2015) all found similar results. However, it is not consistent with the findings of Nugroho et al. (2019), Panigrahi (2017), Silitonga et al. (2018), and Andhika and Yunita (2016). 19 Economic Value Added and Market Performance Economic value added is an estimate of a firm's economic profit, or the value created in excess of the required return to the company's shareholders. Economic value-added is the measurement of a company’s value added by reducing the burden of the cost of capital arising from the investments that have been made. Economic value added is a measure that reveals the financial performance of a business based on its residual income. It aims to define the value a company generates with the help of the invested funds and improve the generated returns for shareholders. Economic value-added signals the economic profit of the company. The excess of economic valueadded shows that economic capital employed exceeds the cost of capital. Positive economic valueadded indicates that the management of the company managed to increase enterprise value for owners in accordance with the objective of financial management, which is to maximize corporate value. In this study, it is shown that any increase in one naira of economic value added will increase the market performance of listed companies in Nigeria. This is because economic value added has a positive and significant effect on market performance. This finding aligns with the finding of Amyulianthy and Ritonga (2016), Panigrahi (2017), Ikbar and Dewi (2015), Imanzadeh, et al (2013), Awan, et al (2015), Maitah, et al (2015), Panigrahi, et al (2015), Babatunde and Evuebie (2017) who has similar conclusion but not in line with the finding of Wong (2005), Nugroho, et al (2019), Alipour and Ebrahim (2015), Akgun, et al (2018), Khan, et al (2014), Silitonga, et al (2018), Sekyere (2016), Andhika and Yunita (2016). The cause of the disparity between the findings of the studies could be a result of a methodological approach based on time frame, a difference in the sector of the studies, or a technique of analysis. Refined Economic Value Added and Market Performance This performance measurement holds that increasing value also means increasing long-term investment returns for shareholders. Companies that are able to create positive REVA value can create added value for investors or shareholders, so investors will be interested in investing their capital and causing share prices to rise. Refined economic value added has a positive and significant effect on the market performance of listed companies in Nigeria. This means that any increase in refined economic value will increase market performance. Thus, positive refined economic value-added signals that the company’s 20 market cost of capital is less than the capital charges. Companies with positive, refined economic value added will attract more investors because it signals wealth has been created from the shareholders’ investment. Based on this finding, the study rejects the hypothesis that refined economic value added has no significant effect on the market performance of listed companies in Nigeria. The finding is consistent with the finding from the study of Nakhaei (2014), Hall (2015), Moghaddam and Shoghi (2012), Nakhaei (2014), Nakhaei, et al (2016), Nugroho (2018) however, it is not consistent with the finding of Gouyandeh (2007), Hajiabbasi, et al (2012). The cause of disparity in the findings could be as a result of methodological approach such as difference in the time frame, difference in the sector of the studies and technique of analysis. 5.0 Conclusion and Recommendations In conclusion, the findings of this study strongly support the notion that Market Value Added (MVA), Economic Value Added (EVA), and Refined Economic Value Added (REVA) play significant roles in influencing market performance. Through rigorous analysis, it has been demonstrated that companies generating higher levels of MVA, EVA, and REVA tend to exhibit stronger market performance metrics. These value-based determinants not only contribute positively to shareholder wealth but also signal the company's ability to create sustainable value in the market. Therefore, investors, financial analysts, and policymakers should consider incorporating these metrics into their evaluations and decision-making processes to better understand and predict market outcomes. Overall, the study underscores the importance of value creation strategies in driving market success and competitiveness. The study recommends the following: i. Companies should focus on value creation strategies that prioritize the generation of MVA, EVA, and REVA. By aligning corporate objectives with these value-based metrics, companies can enhance their market performance, attract investors, and foster long-term growth and profitability. ii. Also, investors are encouraged to adopt long-term investment strategies that prioritize companies with strong MVA, EVA, and REVA performance. 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