Factor Analysis to Evaluate the Financial Performance of the Construction Industry in an Emerging Market: The Case of Colombia
DOI:
https://doi.org/10.46661/revmetodoscuanteconempresa.2770Keywords:
construction companies, developing countries, factorial analysis, financial ratio analysis, compañías constructoras, países en vías de desarrollo, análisis factorial, análisis de las ratios financierasAbstract
Factor analysis is a method used to reduce several variables into fewer dimensions called factors. This study conducts factor analysis on the financial ratios of the construction companies in Colombia in the period 2000--2014. According to that, the purpose of the study is to use the factorial analysis technique to determine whether the financial ratios are related to a smaller number of unobservable factors and eliminate redundancy among them. The results show that it is possible to explain 88.753% of the variance with 13 financial ratios grouped into three factors.
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