Financial Risk Assessment Of Internet Enterprises Under Diversification Strategy

With the development of China's economy,Internet companies have gradually become one of the pillar industries of China's national economy.Although the Internet industry enjoys the strong support of national policies and the dividends brought by advanced technologies,it also faces rapid technological changes and rapid growth of the industry The resulting fierce competition.The advanced nature and strong applicability of Internet technology determine that companies in the Internet industry are often not limited to their own single business The changes in Internet technology also make Internet companies not limited to just one corner.Successful use of diversification strategies can enable companies to improve their operational capabilities,but failed diversi fication strategies will expose companies to risks due to resource dispersion,loss of clear profitable sections,and even serious financial risks.Since the implementation of the diversification strategy of Storm Group,the operating conditions and financial performance have been deteriorating.In 2018,even the actual controller was arrested and the debts could not be repaid.This paper analyzes the operation and financial performance of Storm Group's diversification strategy,discusses the process of financial risk arising from its diversified expansion,and selects the financial data of 30 listed Internet companies in 201 8 as the research object,based on the principal component analysis By comparison,it was found that Storm Group has significant financial risks in terms of profitability and development capabilities,and it has identified its specific financial risks based on its major financial data in recent years.Then establish Stormwind Group's financial risk evaluation system,combine the entropy method to weight the financial risk evaluation indicators,and introduce the efficiency coefficient method to comprehensively score its financial indicators,on this basis,establish a financial risk evaluation system to confirm Stormwind Group risk The level of concern,combined with Stormwind's operating and financial status in recent years,confirms that the evaluation system can effectively predict the level of financial risk,and puts forward relevant recommendations to Stormwind based on the evaluation and analysis results.As a representative Internet company,Storm has its warnings and guidance for other related companies from its failure to diversify and expand.