Evaluating the Impact of Foreign Investment in Public Quoted Firms on Firm Performance: Insights from Nigeria’s Market Dynamics and Investment Success Factors

Foreign investment is important for firm performance, especially in emerging markets like Nigeria. However, its effects on publicly quoted companies remain underexplored. This study assesses how foreign investment impacts firm performance based on key market dynamics and investment success factors. The research examines how foreign investment influences profitability and market performance in Nigeria. It focuses on revenue allocation trends, sectoral performance, and the impact of GDP growth, inflation, exchange rates, and political stability. A quantitative approach was used, analyzing secondary data from nine quoted companies across six sectors over 15 years (2007-2022). Descriptive statistics and regression analysis measured financial metrics like Return on Equity (ROE), Return on Invested Capital (ROIC), and Net Profit Margin (NPM) against market conditions. Results showed that sectors like communication (ROE of 116.5% for MTN Nigeria) and consumer goods (ROIC of 42.7% for Nestlé Nigeria) benefited significantly from foreign investments, while energy and healthcare struggled. Market factors, including inflation (13.08%) and exchange rates (279.75 NGN/USD), had statistically significant effects (p < 0.05). The study concludes that while foreign investment boosts firm performance, market volatility and sector-specific challenges remain. Recommendations include stronger regulations, targeted incentives, and improved political stability to attract investment.