Capital Structure and Firm Performance among the Listed Agro-Allied Firms in Nigeria

The study empirically investigates the effect of capital structure on firm performance among agro-allied firms listed on the Nigerian Stock Exchange from 2003 to 2017. The performance was measured by return on investment, return on assets, and earnings per share, while the capital structure was captured by leverage and equity finance. Equity finance was found to significantly affect returns on investment and assets, while leverage impacted earnings per share. Also, firms’ growth and age are positively related to performance, while size has an inverse relationship. Therefore, firms should adopt an efficient equity-debt level ratio that significantly improves performance over a specific production period.