Empirical Study On Financial Distress Of Listed Companies Based On Industry Perspective

Corporate Finance reflects the financial position, operating results and cash flows. Corporate Finance into the dilemma is a gradual process and is predictable. Financial Crisis can detect and predict whether there is a problem with corporate finance. Existing early warning of financial crisis is the most studied of all the industry data, no study comparing several industry. The financial performance of different industries is different , such as manufacturing companies and financial services companies are completely different. Therefore, industry factors are major factors of the development and financial situation of enterprises. The financial crisis early-warning model based on the Individual sectors can not only enhance practicality, but also enable business stakeholders to understand the characteristics of the industry per and make the right decisions.This paper studied four industries, namely machinery and equipment instrumentation industry, metal and nonmetal industry, information technology industry and chemical industry. This paper selects 33 listed companies (due to different accounting standards, excluding the Growth Enterprise Market and the B-share market), which were the first time ST or *ST in the four sectors in 2009 and 2010 in the Shanghai and Shenzhen stock market as the study sample. And in accordance with the ratio of 10:1 pairing, it selects the 297 listed companies as a paired sample. First of all, the 23 variables listed company's financial indicators selected initially were done with the test of them normality. Variables which meet the normality distribution were done with independent samples T test, and the variables which doesn't meet the normality distribution are done with the two non- parametric test. Then it chooses the significant differences variables, which are tested with the factor analysis. According to eigenvalue greater than 1 or the cumulative contribution rate greater than 80% it selects the number of common factors. Finally, it establishes the financial distress prediction model based on comprehensive data and various industries.The following conclusions: 1) Generally speaking, the prediction accuracy of the single industry model is higher than the integrated data model; 2) For all industries, profitability, have entered into a logistic regression model, played a role in early warning; 3) The common factors into the final logistic regression model are different to different industries.