Categorizing enterprises through advanced operating profit margin metrics

Đuričin, Sonja and Beraha, Isidora and Jeločnik, Marko (2024) Categorizing enterprises through advanced operating profit margin metrics. International review (1/2). pp. 53-60. ISSN 2217-9739

Text djuricin, beraha, jelocnik.pdf - Published Version Available under License Creative Commons Attribution Non-commercial No Derivatives. Download (259kB)

Abstract

The research objective is to test the potential for overcoming limitations in the interpretation of ratios,
with a focus on Operating Profit Margin (OPM). The research examines the OPM values of 43 enterprises
over five consecutive accounting periods. It uses Linear Discriminant Analysis (LDA) to determine the
range of OPM values and assess financial performance more dynamically. The methodology focuses on
calculating the OPM for each enterprise, followed by a categorization into successful, neutral or bankrupt
based on the financial results derived from the financial reports. This research not only challenges
traditional financial ratio analysis, but also contributes to strategic financial management by allowing a
more detailed categorization of enterprises based on their operational profitability, thus providing a robust
tool for financial decision making and predictive analysis.

Item Type:	Article
Additional Information:	COBISS.ID=149516297
Uncontrolled Keywords:	Operating Profit Margin (OPM), Financial Performance, Linear Discriminant Analysis (LDA), Ratio Analysis, Bankruptcy Prediction
Research Department:	Innovation Economics
Depositing User:	Jelena Banovic
Date Deposited:	21 Aug 2024 10:28
Last Modified:	21 Aug 2024 10:28
URI:	http://35.240.28.64/id/eprint/2091
Author Links:	[error in script] No links available.

Actions (login required)

View Item