Unique fundamentals and severe uncertainty in the junior-mining-sector (JMS) make valuing JMS ventures problematic. However, potentially enormous returns draw many investors into the JMS. While financial-instrument-pricing theory suggests that accounting values/ratios should have little influence on JMS-firm outcomes, this study’s simple OLS and Panel-data findings show strong correlation between those variables and JMS-firm-share prices. After discounting market failure, it is conjectured that JMS nonfinancial factors, share prices and accounting values are co-determined in a simultaneous relationship that is obscurely linked to outcomes. The notions uncovered in this study should greatly interest academics and business sector participants.
Recommended CitationIddon, Casey; Hettihewa, Samanthala; and Wright, Christopher S., Value Relevance of Accounting and Other Variables in the Junior-Mining Sector, Australasian Accounting, Business and Finance Journal, 9(1), 2015, 25-42.