The Application Of Factor Analysis On The Performance Evaluation Of Listed Companies

The stock market has been playing a more and more important role in the national economy. The performance of listed companies determines the stable development of stock market. It is of great significance to evaluate the listed companies' performance accurately and fairly. Scientific evaluation system not only reflects the listed companies' performance, but also provides reliable information for investors and stakeholders. This thesis reviews the evaluation theory about the listed companies, analyzes the existing listed companies' evaluation system in China, and then designs a new listed companies' evaluation system in terms of China's practice. Compared with other evaluation methods, factor analysis can be used to evaluate Company Performance. In addition, it can also give companies' information of their business status and disadvantages. Companies can use the information to make decision and improve their performance. This method eliminates the effect of correlativity among indexes and thus it is more objective. By setting example on communication equipment manufacturing companies, this thesis applies this factor analysis method to evaluate the listed companies' performance and analyzes their operation state.