The creation of value in listed companies has been of interest to the research field and to pract... more The creation of value in listed companies has been of interest to the research field and to practitioners in the investment arena for more than eighty years. It can be considered to have two aspects the first with more quantitative elements related to financial and performance aspects, and the second with more qualitative elements related to company competitiveness. The stated goal is the evaluation of the factors that influence value creation in different economic contexts and their possible changes of listed infrastructure companies with data referring to before, during and after the crisis of 2008. The fuzzy-set QCA method has been used, where the relationship between both factors, qualitative and comparative, can be reflected on an output related to value creation, represented by the Total Shareholder Return (TSR). The TSR is an appropriate indicator as it provides a broader measure, which includes the share price, and represents the overall return that the investor can achieve, that is, the amount returned to shareholders. The conclusions reached highlight the importance of qualitative and quantitative factors, as well as their combination, in creating value and that there are differences that exist before, during and after the crisis.
A vast digital ecosystem of entrepreneurship and exchange has sprung up with Bitcoin’s digital in... more A vast digital ecosystem of entrepreneurship and exchange has sprung up with Bitcoin’s digital infrastructure at its core. We explore the worldwide spread of infrastructure necessary to maintain and grow Bitcoin as a system (Bitcoin nodes) and infrastructure enabling the use of bitcoins for everyday economic transactions (Bitcoin merchants). Specifically, we investigate the role of legal, criminal, financial, and social determinants of the adoption of Bitcoin infrastructure. We offer some support for the view that the adoption of cryptocurrency infrastructure is driven by perceived failings of traditional financial systems, in that the spread of Bitcoin infrastructure is associated with low trust in banks and the financial system among inhabitants of a region, and with the occurrence of country-level inflation crises. On the other hand, our findings also suggest that active support for Bitcoin is higher in locations with well-developed banking services. Finally, we find support for ...
La inflación es un fenómeno muy importante para la economía, ya que algunas de las crisis económi... more La inflación es un fenómeno muy importante para la economía, ya que algunas de las crisis económicas más severas que ha habido en el mundo se debieron a una descontrolada inflación. Pero una disminución de precios, llamada deflación, tampoco es positiva para la economía, puesto que se entra en una espiral peligrosa: como los bienes y servicios bajan de precio, lo lógico es retrasar las compras y las inversiones: las empresas no generan los ingresos necesarios y algunas desaparecen, aumentando el desempleo. La indexación financiera es básicamente un mecanismo de reajuste de precios en el cual el valor de los pagos nominales se actualiza en función de algún precio o índice de precios, lo que permite crear un instrumento financiero libre del riesgo de la inflación. Esta alcanza su máxima etapa de desarrollo cuando existe una unidad de cuenta indexada de amplio uso. Este es el caso de la Unidad de Fomento (UF) de Chile creada en 1967, unidad de cuenta indexada al índice de precios al co...
We investigate the profitability persistence of the investment recommendations from analysts list... more We investigate the profitability persistence of the investment recommendations from analysts listed in four different star rankings, Institutional Investor magazine, StarMine's BTop Earnings Estimators^and BTop Stock Pickers^, and The Wall Street Journal, and show the predictive power of each evaluation methodology. We found that only Buy and Strong Buy recommendations from the entire group of Star analysts outperform those of the Non-Stars in the year after election, while Sell and Strong Sell recommendations performed as those of the Non-Stars. We document that the highest average monthly abnormal return of holding a long-short portfolio, 0.97 %, is obtained by following the recommendations of the group of star sell-side analysts rated by StarMine's BTop Earnings Estimators^during the period from 2003 to 2014. Since earnings are one of the main drivers of stock prices, the results obtained are in line with the notion that focusing on superior earnings forecasts is one of the top requirements for successful stock picks.
This paper examines the implications of strategic rigidness for technology adoption behaviours am... more This paper examines the implications of strategic rigidness for technology adoption behaviours among electric utilities. Such behaviours lead to heterogeneity in firm performance and consequently affect the electric utility industry. The paper's central aim is to identify and describe the implications of strategic rigidness for a utility firm's decision making in adopting newer renewable energy technologies. The findings indicate that not all utility firms are keen to adopt these new technologies, as these firms have traditionally been operating efficiently with a more conventional and mature technological arrangement that has become embedded in the organisational routine. Case studies of Iberdrola S.A. and Enel S.p.A. as major electric utilities are detailed to document mergers and acquisitions and technology adoption decisions. The results indicate that technology adoption behaviours vary widely across utility firms with different organisational learning processes and core capabilities.
PurposeThe strategic management literature lacks a comprehensive explanation as to why seemingly ... more PurposeThe strategic management literature lacks a comprehensive explanation as to why seemingly similar business models in the same industry perform differently. This paper strives to explain this phenomenon.Design/methodology/approachThe model is conceptualized and accompanied by a case study on the airline industry to explain knowledge brokerage that creates value from the effective utilization of knowledge resources acquired from intra‐ and inter‐firm environments.FindingsThe model explains a cyclical view of business model flexibility in which the knowledge‐based resource accumulation of the business model is spread across the intra‐ and inter‐firm environments. Knowledge brokerage strategies from the inter‐ and intra‐firm environments result in improved performance of the business model. The flexibility that the business model acquires is determined by how efficiently resource accumulation is aligned with its external environment.Originality/valueThe paper effectively integrat...
Innovations in the current interconnected world of organizations have lead to a focus on business... more Innovations in the current interconnected world of organizations have lead to a focus on business models as a fundamental statement of direction and identity. Although industry transformations generally emanate from technological changes, recent examples suggest they may also be due to the introduction of new business models. In the past, different types of airline business models could be clearly separated from each other. However, this has changed in recent years partly due to the concentration process and partly to reaction caused by competitive pressure. At least it can be concluded that in future the distinction of different business models will remain less clear. To advance the use of business models as a concept, it is essential to be able to compare and perform analyses to identify the business models that may have the highest potential. This can essentially contribute to understanding the synergies and incompatibilities in the case of two airlines that are going in for a merger. This is illustrated by the example of Swiss Air-Lufthansa merger analysis.The idea is to develop quantitative methods and tools for comparing and analyzing Aeronautical/Airline business models. The paper identifies available methods of comparing airline business models and lays the ground work for a quantitative model of comparing airline business models. This can be a useful tool for business model analysis when two airlines are merged.
Lecture Notes in Management and Industrial Engineering, 2014
Is it profitable for an investor, from a risk-return perspective, to acquire a stake in a quoted ... more Is it profitable for an investor, from a risk-return perspective, to acquire a stake in a quoted company when a capital increase is announced? This paper analyses the return obtained from the investment in equity issues with cash contribution and pre-emptive rights, aimed at funding corporate activities: acquisitions, investments in new facilities and/or strengthening the balance sheet of the companies undertaking the equity issue. During the 16 years covered by the study, the results show a negative average excess risk-adjusted return of almost 5%, from the moment that the equity offer is announced until the completion of the preferential subscription period. To obtain this excess return, the difference between the nominal Internal Rate of Return (IRR) and the expected return, using the CAPM, is computed for each equity issue. The intention behind this method is to eliminate the effects of time and any other possible effect on the stock price during the period of the analysis. The results from this article are consistent with the Pecking Order theory for the Spanish Stock Market also six months after the preferential subscription period. However, there is a positive return after three months.
The correct valuation of an RD project is a rather complex process. Aside from the fact that it c... more The correct valuation of an RD project is a rather complex process. Aside from the fact that it can take several years to launch a new product after extensive investment, there happens to be a significant abandonment probability at each of the development and exploitation stages. Significant uncertainty is also inherently attached to both development costs and subsequent operational cash flows (be it the case of receiving final approval for commercial purposes). These cash flows need to be estimated with anticipation in order to give a reasonable value for the patent or RD project. The approach undertaken herein is to consider the patent or RD project as a complex option on relevant underlying stochastic variables: investment costs and operational cash flows. A model is proposed, programmed and applied to a real case.
The purpose of this paper is to explore turnaround performance as a resultant from both Collabora... more The purpose of this paper is to explore turnaround performance as a resultant from both Collaborative Decision Making (CDM) processes and collaborative measures. This paper presents how CDM operates in the Turnaround Process (TAP) to propose a new method for managing the collaborative turnaround performance of all actors by predicting the most critical indicators. To achieve this, data from a CDM airport is used. Sample data of 6500 observations, taken from turnaround movements handled in 2014 at Madrid-Barajas Airport, were obtained from three separate databases and analyzed separately (in three databases). To predict turnaround performance, this paper also introduces a predictor dependent variable called “star values†as a measure of minimal delay conditions in order to predict time performance. The analysis shows that the proposed method unveils a new approach in determining how collaborative performance can be measured in the TAP and the predicted key performance indicators, which shows variations in the predicted CDM indicators. Results challenge managers and policymakers to find which improvements can be enacted for better usage of airport infrastructures and resources for optimum use as well as enhanced TAP. In terms of theory use and extension, the study reveals how CDM is an essential element in the literature on air traffic management.
ABSTRACT There has been a long-standing concern that strategy literature needs a better understan... more ABSTRACT There has been a long-standing concern that strategy literature needs a better understanding of how organizational structure can affect performance and decision making within organizations. Previous research indicates that the relationship between organizational structure and performance is unexpectedly asymmetric. The balance between too much and too little structure is critical for an organization’s high performance in dynamic environments. Organizations with too little structure lack enough guidance but can be flexible, while organizations with too much structure are too constrained and lack flexibility. In addition, less structured emergent strategies tend to be high performing in dynamic environments, whereas more structured prescriptive strategies tend to perform well in stable environments. Accordingly, the optimal amount of structure decreases with increasing environmental dynamism, a consistent finding in existing literature. In this paper a review of literature on how organizational structure influences performance within organizations and the role of the environment is presented. It also incorporates and signifies the role of the Strategy, Structure and Performance (SSP) paradigm, which has played a central role within strategy research. By means of this, we will be able to know how the core knowledge required for decision-making and the coordination challenges within firms drive their internal structures, and how the implication of the appropriate degree of strategy-structure fit on the performance of a firm. The aim here is to develop a more precise theory of the fundamental relationships among structure, performance and the environment.
... Markets From a Passive Investor's Perspective Felipe Ruiz, Guillermo Martínez and Rafael... more ... Markets From a Passive Investor's Perspective Felipe Ruiz, Guillermo Martínez and Rafael Ruiz ... References Arnott RD, Hsu JC, West JM (2008) The fundamental index: a better way to invest. Wiley, Hoboken Bodie Z, Kane A, Marcus AJ (2002) Investments, 6th edn. ...
El empleo de índices que consideran como criterio de ponderación la capitalización bursátil, pres... more El empleo de índices que consideran como criterio de ponderación la capitalización bursátil, presenta el problema de que, al sobreponderar los valores sobrevalorados e infraponderar los valores infravalorados, perjudican la rentabilidad del índice. El "Fundamental Index" (FI) trata de evitar este problema utilizando como ponderaciones parámetros más fundamentales del peso de cada empresa en la economía. En el presente trabajo se compara la rentabilidad del FI frente al IBEX-35, empleando datos de la bolsa española durante el período 1992 a 2009. Se obtiene una mayor rentabilidad del FI durante dicho período y un significativo mejor comportamiento durante los años bursátiles bajistas.
Resumen Yield management is the process of actively managing inventory to maximize revenues. In t... more Resumen Yield management is the process of actively managing inventory to maximize revenues. In this paper we present a model devised to apply yield management techniques using real options to the problem of optimal decision making when assigning rooms to ...
The creation of value in listed companies has been of interest to the research field and to pract... more The creation of value in listed companies has been of interest to the research field and to practitioners in the investment arena for more than eighty years. It can be considered to have two aspects the first with more quantitative elements related to financial and performance aspects, and the second with more qualitative elements related to company competitiveness. The stated goal is the evaluation of the factors that influence value creation in different economic contexts and their possible changes of listed infrastructure companies with data referring to before, during and after the crisis of 2008. The fuzzy-set QCA method has been used, where the relationship between both factors, qualitative and comparative, can be reflected on an output related to value creation, represented by the Total Shareholder Return (TSR). The TSR is an appropriate indicator as it provides a broader measure, which includes the share price, and represents the overall return that the investor can achieve, that is, the amount returned to shareholders. The conclusions reached highlight the importance of qualitative and quantitative factors, as well as their combination, in creating value and that there are differences that exist before, during and after the crisis.
A vast digital ecosystem of entrepreneurship and exchange has sprung up with Bitcoin’s digital in... more A vast digital ecosystem of entrepreneurship and exchange has sprung up with Bitcoin’s digital infrastructure at its core. We explore the worldwide spread of infrastructure necessary to maintain and grow Bitcoin as a system (Bitcoin nodes) and infrastructure enabling the use of bitcoins for everyday economic transactions (Bitcoin merchants). Specifically, we investigate the role of legal, criminal, financial, and social determinants of the adoption of Bitcoin infrastructure. We offer some support for the view that the adoption of cryptocurrency infrastructure is driven by perceived failings of traditional financial systems, in that the spread of Bitcoin infrastructure is associated with low trust in banks and the financial system among inhabitants of a region, and with the occurrence of country-level inflation crises. On the other hand, our findings also suggest that active support for Bitcoin is higher in locations with well-developed banking services. Finally, we find support for ...
La inflación es un fenómeno muy importante para la economía, ya que algunas de las crisis económi... more La inflación es un fenómeno muy importante para la economía, ya que algunas de las crisis económicas más severas que ha habido en el mundo se debieron a una descontrolada inflación. Pero una disminución de precios, llamada deflación, tampoco es positiva para la economía, puesto que se entra en una espiral peligrosa: como los bienes y servicios bajan de precio, lo lógico es retrasar las compras y las inversiones: las empresas no generan los ingresos necesarios y algunas desaparecen, aumentando el desempleo. La indexación financiera es básicamente un mecanismo de reajuste de precios en el cual el valor de los pagos nominales se actualiza en función de algún precio o índice de precios, lo que permite crear un instrumento financiero libre del riesgo de la inflación. Esta alcanza su máxima etapa de desarrollo cuando existe una unidad de cuenta indexada de amplio uso. Este es el caso de la Unidad de Fomento (UF) de Chile creada en 1967, unidad de cuenta indexada al índice de precios al co...
We investigate the profitability persistence of the investment recommendations from analysts list... more We investigate the profitability persistence of the investment recommendations from analysts listed in four different star rankings, Institutional Investor magazine, StarMine's BTop Earnings Estimators^and BTop Stock Pickers^, and The Wall Street Journal, and show the predictive power of each evaluation methodology. We found that only Buy and Strong Buy recommendations from the entire group of Star analysts outperform those of the Non-Stars in the year after election, while Sell and Strong Sell recommendations performed as those of the Non-Stars. We document that the highest average monthly abnormal return of holding a long-short portfolio, 0.97 %, is obtained by following the recommendations of the group of star sell-side analysts rated by StarMine's BTop Earnings Estimators^during the period from 2003 to 2014. Since earnings are one of the main drivers of stock prices, the results obtained are in line with the notion that focusing on superior earnings forecasts is one of the top requirements for successful stock picks.
This paper examines the implications of strategic rigidness for technology adoption behaviours am... more This paper examines the implications of strategic rigidness for technology adoption behaviours among electric utilities. Such behaviours lead to heterogeneity in firm performance and consequently affect the electric utility industry. The paper's central aim is to identify and describe the implications of strategic rigidness for a utility firm's decision making in adopting newer renewable energy technologies. The findings indicate that not all utility firms are keen to adopt these new technologies, as these firms have traditionally been operating efficiently with a more conventional and mature technological arrangement that has become embedded in the organisational routine. Case studies of Iberdrola S.A. and Enel S.p.A. as major electric utilities are detailed to document mergers and acquisitions and technology adoption decisions. The results indicate that technology adoption behaviours vary widely across utility firms with different organisational learning processes and core capabilities.
PurposeThe strategic management literature lacks a comprehensive explanation as to why seemingly ... more PurposeThe strategic management literature lacks a comprehensive explanation as to why seemingly similar business models in the same industry perform differently. This paper strives to explain this phenomenon.Design/methodology/approachThe model is conceptualized and accompanied by a case study on the airline industry to explain knowledge brokerage that creates value from the effective utilization of knowledge resources acquired from intra‐ and inter‐firm environments.FindingsThe model explains a cyclical view of business model flexibility in which the knowledge‐based resource accumulation of the business model is spread across the intra‐ and inter‐firm environments. Knowledge brokerage strategies from the inter‐ and intra‐firm environments result in improved performance of the business model. The flexibility that the business model acquires is determined by how efficiently resource accumulation is aligned with its external environment.Originality/valueThe paper effectively integrat...
Innovations in the current interconnected world of organizations have lead to a focus on business... more Innovations in the current interconnected world of organizations have lead to a focus on business models as a fundamental statement of direction and identity. Although industry transformations generally emanate from technological changes, recent examples suggest they may also be due to the introduction of new business models. In the past, different types of airline business models could be clearly separated from each other. However, this has changed in recent years partly due to the concentration process and partly to reaction caused by competitive pressure. At least it can be concluded that in future the distinction of different business models will remain less clear. To advance the use of business models as a concept, it is essential to be able to compare and perform analyses to identify the business models that may have the highest potential. This can essentially contribute to understanding the synergies and incompatibilities in the case of two airlines that are going in for a merger. This is illustrated by the example of Swiss Air-Lufthansa merger analysis.The idea is to develop quantitative methods and tools for comparing and analyzing Aeronautical/Airline business models. The paper identifies available methods of comparing airline business models and lays the ground work for a quantitative model of comparing airline business models. This can be a useful tool for business model analysis when two airlines are merged.
Lecture Notes in Management and Industrial Engineering, 2014
Is it profitable for an investor, from a risk-return perspective, to acquire a stake in a quoted ... more Is it profitable for an investor, from a risk-return perspective, to acquire a stake in a quoted company when a capital increase is announced? This paper analyses the return obtained from the investment in equity issues with cash contribution and pre-emptive rights, aimed at funding corporate activities: acquisitions, investments in new facilities and/or strengthening the balance sheet of the companies undertaking the equity issue. During the 16 years covered by the study, the results show a negative average excess risk-adjusted return of almost 5%, from the moment that the equity offer is announced until the completion of the preferential subscription period. To obtain this excess return, the difference between the nominal Internal Rate of Return (IRR) and the expected return, using the CAPM, is computed for each equity issue. The intention behind this method is to eliminate the effects of time and any other possible effect on the stock price during the period of the analysis. The results from this article are consistent with the Pecking Order theory for the Spanish Stock Market also six months after the preferential subscription period. However, there is a positive return after three months.
The correct valuation of an RD project is a rather complex process. Aside from the fact that it c... more The correct valuation of an RD project is a rather complex process. Aside from the fact that it can take several years to launch a new product after extensive investment, there happens to be a significant abandonment probability at each of the development and exploitation stages. Significant uncertainty is also inherently attached to both development costs and subsequent operational cash flows (be it the case of receiving final approval for commercial purposes). These cash flows need to be estimated with anticipation in order to give a reasonable value for the patent or RD project. The approach undertaken herein is to consider the patent or RD project as a complex option on relevant underlying stochastic variables: investment costs and operational cash flows. A model is proposed, programmed and applied to a real case.
The purpose of this paper is to explore turnaround performance as a resultant from both Collabora... more The purpose of this paper is to explore turnaround performance as a resultant from both Collaborative Decision Making (CDM) processes and collaborative measures. This paper presents how CDM operates in the Turnaround Process (TAP) to propose a new method for managing the collaborative turnaround performance of all actors by predicting the most critical indicators. To achieve this, data from a CDM airport is used. Sample data of 6500 observations, taken from turnaround movements handled in 2014 at Madrid-Barajas Airport, were obtained from three separate databases and analyzed separately (in three databases). To predict turnaround performance, this paper also introduces a predictor dependent variable called “star values†as a measure of minimal delay conditions in order to predict time performance. The analysis shows that the proposed method unveils a new approach in determining how collaborative performance can be measured in the TAP and the predicted key performance indicators, which shows variations in the predicted CDM indicators. Results challenge managers and policymakers to find which improvements can be enacted for better usage of airport infrastructures and resources for optimum use as well as enhanced TAP. In terms of theory use and extension, the study reveals how CDM is an essential element in the literature on air traffic management.
ABSTRACT There has been a long-standing concern that strategy literature needs a better understan... more ABSTRACT There has been a long-standing concern that strategy literature needs a better understanding of how organizational structure can affect performance and decision making within organizations. Previous research indicates that the relationship between organizational structure and performance is unexpectedly asymmetric. The balance between too much and too little structure is critical for an organization’s high performance in dynamic environments. Organizations with too little structure lack enough guidance but can be flexible, while organizations with too much structure are too constrained and lack flexibility. In addition, less structured emergent strategies tend to be high performing in dynamic environments, whereas more structured prescriptive strategies tend to perform well in stable environments. Accordingly, the optimal amount of structure decreases with increasing environmental dynamism, a consistent finding in existing literature. In this paper a review of literature on how organizational structure influences performance within organizations and the role of the environment is presented. It also incorporates and signifies the role of the Strategy, Structure and Performance (SSP) paradigm, which has played a central role within strategy research. By means of this, we will be able to know how the core knowledge required for decision-making and the coordination challenges within firms drive their internal structures, and how the implication of the appropriate degree of strategy-structure fit on the performance of a firm. The aim here is to develop a more precise theory of the fundamental relationships among structure, performance and the environment.
... Markets From a Passive Investor's Perspective Felipe Ruiz, Guillermo Martínez and Rafael... more ... Markets From a Passive Investor's Perspective Felipe Ruiz, Guillermo Martínez and Rafael Ruiz ... References Arnott RD, Hsu JC, West JM (2008) The fundamental index: a better way to invest. Wiley, Hoboken Bodie Z, Kane A, Marcus AJ (2002) Investments, 6th edn. ...
El empleo de índices que consideran como criterio de ponderación la capitalización bursátil, pres... more El empleo de índices que consideran como criterio de ponderación la capitalización bursátil, presenta el problema de que, al sobreponderar los valores sobrevalorados e infraponderar los valores infravalorados, perjudican la rentabilidad del índice. El "Fundamental Index" (FI) trata de evitar este problema utilizando como ponderaciones parámetros más fundamentales del peso de cada empresa en la economía. En el presente trabajo se compara la rentabilidad del FI frente al IBEX-35, empleando datos de la bolsa española durante el período 1992 a 2009. Se obtiene una mayor rentabilidad del FI durante dicho período y un significativo mejor comportamiento durante los años bursátiles bajistas.
Resumen Yield management is the process of actively managing inventory to maximize revenues. In t... more Resumen Yield management is the process of actively managing inventory to maximize revenues. In this paper we present a model devised to apply yield management techniques using real options to the problem of optimal decision making when assigning rooms to ...
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Papers by Felipe Ruiz