The Analysis of Firm Size, Asset Tangibility, and FinancialPerformance of Non-Financial Firms Listed on TheNigerian Exchange Limited
Year: 2026
Type: article
Abstract: This study examined the effect of asset tangibility, a firm-specific factor, on the financial performance of non-financial firms listed on the Nigerian Exchange Group and assessed the moderating role of firm size. Covering 78 firms across nine industries, including oil and gas, communication, real estate, healthcare, industrial goods, consumer goods, services, and conglomerates, the study spanned the period from 2012 to 2024. Descriptive statistics were employed to summarize the data characteristics, while the cross-sectional dependence augmented IPS (CIPS) test was used to assess stationarity. Additional diagnostic tests, including correlation analysis, slope heterogeneity, heteroscedasticity, and serial correlation, ensured model robustness. The Prais-Winsten regression with panel-corrected standard errors (PCSEs) was applied to estimate the long-run effects of the explanatory variables on financial performance. Empirical findings showed that asset tangibility exerted a negative and statistically significant effect on financial performance, suggesting that higher fixed asset intensity reduces profitability. The moderating analysis further revealed that firm size strengthened the relationship between asset tangibility and financial performance, indicating that larger firms can better leverage tangible assets to enhance efficiency and returns. These results highlight the importance of strategic asset allocation and scale efficiency in improving firm performance. The study recommends that firm managers optimize asset structures and pursue growth strategies that exploit size advantages to mitigate inefficiencies linked to excessive asset tangibility and sustain long-term financial performance in Nigeria’s non-financial sector.
DOI: 10.14419/kfc48e05
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W7123533100
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