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On the Usefulness of Financial Ratios to Investors in Common Stock: A Reply.

Melvin C. O'Connor

Assistant Professor, Department of Accounting & Financial Administration, Michigan State University 1

The Accounting Review 1974

This article presents a reply to the comments on the usefulness of financial ratios to investors in common stock in the U.S. Emphasis has been placed on the intention that ratios be considered only a first step in the total evaluation of the usefulness of financial ratios to investors. Within this framework the research design and testing were appropriate. The conclusion of ratios should not be taken from the context and limitations of the models and methodology of the study. To do so increases the risk of attaching greater weight to the conclusion than was ever contemplated by the research.

DOI
10.2308/tar-4515073
Volume
49 (3)
Pages
551-556
Language
en
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