Research On The Correlation Between The Financial Status Of Listed Companies In The Pharmaceutical Industry And Investors' Excess Return

In the capital market,investors take outperforming the market to obtain excess returns as their pursuit of investment objectives.According to the experience of most professional investors,it is the key for investors to obtain excess returns to select industries or companies with rapid growth as investment objects.The pharmaceutical industry has a broad prospect and the expanding market size,the pharmaceutical industry stocks at the same time with consumption attributes and scientific and technological attributes,outbreak ability is strong,is a worthy of investors long-term investment track.From the point of view of past investment income,many listed companies in the pharmaceutical industry have brought investors rich excess income,investors are more concerned about the industry.Therefore,this paper takes the pharmaceutical industry as the research objective,takes the internal value of listed companies--financial status as the explanatory variable,and takes the excess return excluding the influence of the background value of CSI 300 index as the explained variable to study the correlation between the two.In this paper,the pharmaceutical industry is divided into six sectors to study the correlation between excess returns and financial status.The top 10 listed companies with market value in six sectors of the pharmaceutical industry from 2011 to 2020 were selected as research samples,and 18 financial indicators valued by investors were selected as explanatory variables of this study from six aspects of capacity per share,profitability,solvency,growth capacity,operating capacity and capital structure.The excess return excluding the influence of CSI 300 index was taken as the explained variable.Pearson correlation test,multicollinearity test and principal component analysis were carried out for 18 financial indicators of each plate,and finally a regression model between excess returns and financial conditions was constructed.The empirical analysis shows that:(1)there is a linear correlation between the financial status of listed companies in the pharmaceutical industry and the excess returns obtained by investors.(2)Although there are differences in the financial indicators related to excess earnings of each sector,the medical service,chemical and pharmaceutical,biological products and pharmaceutical business sectors are all correlated with the per share index,while the medical service,chemical and pharmaceutical,biological products and traditional Chinese medicine sectors are correlated with the profitability index.Medical services,biological products,traditional Chinese medicine and pharmaceutical business sectors are correlated with the operating capacity index.The three types of financial indicators,such as per share index,profitability index and operating ability index,are crucial for investors in the pharmaceutical industry to obtain excess returns,and are factors that investors should consider when making investment decisions.The research results of this paper have certain reference significance for investors to obtain excess returns from value investment.