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Abstract
This study looked into how Nepalese insurance companies' stock prices were affected by their financial
performance. A company's total financial health during a specific time period is gauged by its financial
performance (FP). Return on equity (ROE), return on assets (ROA), earnings per share (EPS), book value
per share (BVPS), and net profit margin (NPM) are the independent variables in the theoretical framework,
while stock price is the dependent variable. Purposive sampling approaches were used to gather data for
the study from five life insurance and five non-life insurance companies that have been in continuous
operation for the past eight years without experiencing any significant changes. utilizing descriptive
analysis, correlation, and other types of regression analysis by using EVIEWS. EPS has a substantial
beneficial effect on stock values, according to the research findings. Return on assets (ROA) has a negative,
large impact on stock prices, while ROE, NPM, and BVPS have negligible effects. Therefore, the insurance
board should create unique regulations for life and non-life insurance companies, and any investor should
take EPS and ROA into account while making stock market investments. The financial fundamental
indicators are always at their best thanks to it. Because of this, insurance companies' stock values are
consistently beneficial on the secondary market.
Key words: Stock Price, Return on Equity, Return on Assets, Net Profit Margin, Earning per Share, and
Book Value per Share.