Stock options and financial performance on Mexican listed companies from industrial sector
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Abstract
This study aims to analyze the relationship between stock options and financial performance over listed firms that belong to the industrial sector in the Mexican Stock Exchange. According to the agency theory, a scheme of variable compensation may favors the interests alignment between shareholders and managers, leading to a higher financial performance. Our final study sample is composed by 135 observations during the period 2015-2017. Using a multivariate regression analysis, empirical results show that stock options do not influence significantly profitability indicators (ROA and ROE). However, the leverage level increases, which may motivate to the management team to increase the investment opportunities. This study has important implications for designing new compensation schemes on listed companies in Mexico.
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