A FINANCIAL PROFILE OF COMPANIES RANKED BY VALUE LINE AS THE MOST 'TIMELY' INVESTMENTS IN A PERIOD OF ECONOMIC RECESSION

摘要

The summer of 2000 was a turning point in American capital markets. There was a slowdown in business activity, an increase in unemployment, and declining values in the equities markets. Later, the period from March 2001 to November 2001 was identified as an economic recession. Value Line continued to rank some firms in their database as "timely" investments. If the industry factor is held constant, the idea of timely investments in a period of economic recession would seem to be an anomaly that could hardly describe the investment potential of most firms. The purpose of this study is to provide a financial analysis of firms described by Value Line as the most timely investments their database, in a period of economic recession. Specifically, the analysis will test for significant differences in financial profiles of the Value Line companies and companies selected at random during the same period, and from the same industries. A unique financial profile is established for the Value Line group, and it is suggested that the profile may be used to predict firms that may be ranked number one for timeliness in the event of future economic downturns.