The Influence of Financial Flexibility on Enterprise’s Profitability in the Future

DOI

10.2991/assehr.k.201012.004How to use a DOI?

Keywords

Financial flexibility, Future profitability, Factor Analysis, Bidirectional fixed effect model

Abstract

With the increasing uncertainty of the contemporary economic market economy, its importance has become increasingly prominent in practice. In order to study the influence of financial flexibility on the enterprise’s future profitability, this paper uses factor analysis to measure the enterprise’s comprehensive profitability index, and uses two single indicators to measure the enterprise’s financial flexibility. Then the effect of financial flexibility on the profitability of non-ferrous metals listed companies is examined by using the bidirectional fixed effect model. The empirical results show that the influence of financial flexibility on profitability has a lag effect; Financial flexibility has a positive correlation with corporate profitability, that is, companies with relatively large financial flexibility have relatively greater profitability, and companies with relatively small financial flexibility have relatively small profitability.

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Download article (PDF)

TY  - CONF
AU  - Yunyun Cai
AU  - Yiding Wu
PY  - 2020
DA  - 2020/10/12
TI  - The Influence of Financial Flexibility on Enterprise’s Profitability in the Future
BT  - Proceedings of the 1st Africa-Asia Dialogue Network (AADN) International Conference (AADNIC 2019)
PB  - Atlantis Press
SP  - 20
EP  - 25
SN  - 2352-5398
UR  - https://doi.org/10.2991/assehr.k.201012.004
DO  - 10.2991/assehr.k.201012.004
ID  - Cai2020
ER  -