The Determinants of Firm Performance: Evidence from Kenya

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This paper investigates the determinants of firm’s performance with evidence of the listed firms in Kenya.I used annual data for the period2013–2018.Various econometric procedures such as Random Effect-GLS was employed.This study examined to conform reasonably strong evidence that firm’s size significantly and positively affects the performance of listed firms in Kenya.This research proved that there is a significant and strong positive correlation between return on asset and log of total sales.Asset turnover is both significant and positive determinant of return of asset.Leverage ratio and profit margin are both inversely related to return on asset with strong significance.Firm’s size,taken as a form of log of total sales is a significant determinant of firm’s performance with positive beta.All the signs of the betas are as expected.This study farther studied those variables in determining ROA in all the sectors with in the listed firms of Nairobi securities exchange.
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