HRMARS - This study investigates the factors associated with stock price variation among listed pharmaceutical firms in China. Using firm-year observations collected from 20 listed companies during 2013–2023 (N = 220), the study evaluates whether accounting performance indicators and selected market variables contribute to stock valuation differences. A multiple regression model was employed to estimate the effects of earnings per share (EPS), price-to-earnings ratio (P/E), return on equity (ROE), market capitalization, trading volume, and benchmark interest rates. The findings reveal that EPS and P/E are positively associated with stock prices, while ROE shows an inverse relationship. In contrast, market capitalization, trading activity, and interest rate fluctuations do not exhibit statistically meaningful effects within the estimated model. The results suggest that investors in China’s pharmaceutical sector appear to respond more strongly to profitability and valuation signals than to macroeconomic conditions or firm scale. These findings enrich the understanding of stock valuation mechanisms in an industry characterized by policy sensitivity and intensive innovation.
Zhanduo et al. (Sun,) studied this question.