Examining the relationship between financial ratios and stock returns: An application on BIST 30 index

Investors trading in capital markets aim to maximize the returns they will obtain from this market. For this reason, determining the factors affecting stock returns is important for investors. The aim of this study is to examine the relationship between financial ratios and stock returns of companies that are listed on the BIST 30 Index as of 2024 and traded on the stock exchange uninterruptedly between the 2016Q2-2023Q4 periods. The financial ratios used in the research include the current ratio, return on equity ratio, asset turnover ratio, inventory turnover ratio, debt/equity ratio, and debt/asset ratio. Stock returns are measured by the rate of return. The relationship between the return rates of stocks of companies listed on the BIST 30 index and the financial ratios of these companies will be examined through the panel data analysis method. In the analysis results; According to the analysis results, the relationship between the current ratio and inventory turnover ratios and the return rate of stocks is significant and negative. The relationship between return on equity ratio, asset turnover ratio and debt/equity ratio and stock returns is significant and positive. The relationship between debt/asset ratio and return rate is meaningless.