The Effect of the Financial Leverage on the Profitability in the Tourism Companies (Analytical Study- Tourism Sector- Jordan)

Abstract

This study aims to identify the financial leverage ratio and the rate of return on investment on profitability for sources of the funding in tourism companies which operating in Jordan. And to achieve this study the researcher use some companies related to the Tourism sector from the firms that listed in Amman Stock Exchange. The study finds the existence of a statistically significant impact for the independent variables (financial leverage and ROI) of the Tourism companies on the Profitability. Moreover, this study concluded that the independent financial variables explain the 4.4% percentage of changes occurring in the Profitability since they are considered as the dependent variable. Furthermore, the results indicate the presence of a statistically significant impact for the financial leverage on the Profitability of the Tourism companies listed in the Amman Exchange.