Research On Profitability Of Listed Dairy Companies Based On Factor Analysis

Dairy industry is an important branch of China’s food industry system and No.1 central document of the dairy industry in 2021 is pointed out: "continue to implement the dairy industry revitalization action,and promote the revitalization of the countryside with the help of dairy industry".In the past five years,No.1 central document mentioned the strategy of vitalizing the development of China’s dairy industry.With the deepening of the new normal concept of economic development,the CPC Central Committee paid more attention to the development of China’s dairy industry and provided strong policy support for it.However,with the change of macroeconomic environment,the rapid entry and exit of small and medium-sized dairy enterprises,and the trust crisis caused by the far-reaching impact of "toxic milk powder",the competition in the dairy industry has become increasingly fierce and the overall income level is not high.Therefore,in the current dairy market environment,dairy enterprises should pay more attention to their own financial situation if they want to obtain a more powerful competitive advantage in the future development process.Improve the income level from many aspects and reduce the input cost to improve the overall profitability of the enterprise,based on long-term development.Based on value creation theory and stakeholder theory,this article analyzes relevant future information on the dairy industry and current research methods on the dairy industry development process and assesses the interest of domestic and foreign companies and summarizes the current research situation and future research direction of the dairy industry profit.Then it puts forward the necessity of using factor analysis method to evaluate the profitability of dairy industry;Secondly,it introduces the applicability and outstanding advantages of factor analysis method for the profitability evaluation of dairy industry,and selects six profitability indicators that can reflect the profitability of the industry according to the evaluation index system of dairy industry;Then,based on the relatively stable development and comprehensive data,24 listed companies in the dairy industry are selected as research samples of this article,and the original data required for the research are obtained from the 2016-2020 annual report published by each company.In order to further comprehensively analyze the specific situation and influencing factors of the profitability of the dairy industry,an empirical analysis model is constructed,After empirical analysis,three factors affecting enterprise profitability are extracted: asset capital operation factor,commodity operation profit factor and cash recovery profit factor;Then,bring the relevant data of the dairy industry into the model,rank the profitability of selected sample companies in the dairy industry according to the factor score and compare the sample companies vertically and horizontally.The results show that the overall profitability of the dairy industry is better from 2016 to 2020,but some enterprises have a downward trend and ups and downs in profitability,which is caused by the fluctuation of the scores of asset capital operation,commodity operation profit and cash recovery profit factors;Then find out the reasons for the fluctuation of factor score: low level of capital operation income,weak ability of enterprise financial fund management,high R & D cost and low capital conversion rate.Finally,with regard to the problems affecting the profitability of dairy products,this paper makes sensible proposals:improve profitability,strengthen capital risk management,establish a good image,establish a brand,and strengthen investment in financing channels,resource management and scientific research.Provide advice and tools to refer to dairy investors and insider users,and to provide a specific research base to maximize the profits of the Chinese dairy industry.