The Financial Determinants of Stocks Performance

By analyzing public companies’ financial statements, this study aims to provide a solution for Investors – identify the key factors that would be applicable across different companies and industries. Ideally, Investors would be able to use it as a screening tool, so that they will be able to choose the companies for the analysis more efficiently and waste less time on the companies that would not add value to their portfolios. What makes this research stand out is the analysis of stock returns instead of absolute price levels. This decision is motivated by the understanding that returns are a more meaningful measure of performance as they capture changes in investment value over time. Investors are primarily concerned with the returns they can earn from a stock rather than its price level at a specific point in time. Moreover, examining returns enables investors to compare the performance of various stocks and investments, as well as monitor the progress of their portfolios over time. By focusing on identifying key factors applicable across different companies and industries, this research aims to provide investors with a valuable screening tool. The objective is to enhance the efficiency of company selection for analysis, enabling investors to allocate their time and resources more effectively by focusing on companies that can potentially add value to their portfolios. This study's distinctive approach and practical implications make it a valuable contribution to the field, addressing the needs and interests of investors seeking to make informed investment decisions