The Impact of Profitability on Stock Market Value Before, During, and After the COVID-19 Pandemic: An Applied Study on Banks Listed on the Amman Stock Exchange

Abstract

This study aimed to analyze the impact of the COVID-19 pandemic on the relationship between profitability indicators and the market value of banks' stocks listed on the Amman Stock Exchange during the period from 2018 to 2024, with a focus on comparing three distinct time phases: pre-pandemic, during the pandemic, and post-pandemic. The research relied on three main profitability indicators: Return on Assets (ROA), Return on Equity (ROE), and Earnings Per Share (EPS). The study sample included all banks listed on the exchange, totaling 18 banks, due to their operational continuity and the complete availability of financial data throughout the study period. The descriptive analytical approach was adopted, whereby data were collected from the financial reports issued by the companies and the official publications of the Amman Stock Exchange. Several statistical methods were employed for data analysis using the SPSS statistical program. The results revealed clear variations in the impact of profitability indicators on stock market value across the different phases of the pandemic. The impact of Earnings Per Share (EPS) was notably prominent during the pandemic period, while Return on Assets (ROA) maintained its stable positive influence. In contrast, Return on Equity (ROE) did not show a statistically significant impact in all phases. In light of these findings, the study recommends adopting dynamic temporal analysis of profitability indicators, focusing on Earnings Per Share (EPS) as a key indicator during crisis periods, improving the quality of financial disclosure in banks, and adopting flexible investment strategies that respond to different economic variables.