ch14.SectorIndustry Analysis外文电子书籍.pptVIP

Sector/Industry Analysis Chapter 14 Charles P. Jones, Investments: Analysis and Management, Ninth Edition, John Wiley Sons Prepared by G.D. Koppenhaver, Iowa State University Introduction The second step in top-down fundamental analysis is sector/industry analysis Sectors refer to broader categories, such as several industries grouped together--for example, the medical sector, or the consumer durables sector What is an Industry? Are industry classifications clear-cut? Industry lines have blurred quite a lot over the years, and industries cannot be casually identified and classified Industries continue to become more mixed in their activities and less identifiable with on product or service Classifying Industries Industries can be classified using the Standard Industrial Classification (SIC) System Based on census data and on the basis of what is produced SIC codes have 11 divisions, A through K Each division has several major industry groups, designated by a two-digit code Larger the number of SIC digits, the more specific the breakdown Other Classifications: SP, Value Line Industry Performance Over Time Potential value of industry analysis seen by assessing the performance of different industries over time SP’s monthly stock price index over a long time period shows industries perform differently over time Stock performance affected by industry Industries in decline should be avoided Industries promising the most opportunity in the future should be considered Industry Performance Over Time Consistency of industry performance Maintaining positions in growth industries leads to better returns than otherwise Can industry performance be predicted reliably on the basis past success? Rankings inconsistent over time Industries with recent poor performance should not be ignored Continual analysis needed due to inconsistent industry performance over time How One Industry Can Affect Investors The telecommunications sector was one of the great growth stories of the 1990s