An equities analyst is studying the pharmaceutical industry and would like your help in exploring and understanding the financial data collected by her firm. Her main objective is to understand the structure of the pharmaceutical industry using some base financial measures.
Financial data gathered on 21 firms in the pharmaceutical industry are available in the 'Pharmaceuticals.csv' dataset.
For each firm, the following variables are recorded:
Market capitalization (in billions of dollars) Beta Price/Earnings ratio Return on equity Return on assets Asset turnover Leverage Estimated revenue growth Net profit margin Median recommendation (across major brokerages) Location of firm's headquarters Stock exchange on which the firm is listed
Elbow plot for Best value for K PC1 determiniation - Most influencing factor - "Principal Component"
Market Capitalization (in billions of dollars) is highest contributor for the PC1. Seems to be one of the deciding factors while clustering the data.
Now interpreting the clusters with respect to the categorical variables I can that see that these clusters are created on the basis of Median Recomendation where Market Capitalization plays an important role to tell us if we should be BUYING, SELLING or HOLDING the stocks for these pharmaceutical companies.
Median Recmmendation is a process used by analyst also known as Consensus Recomendation where Analyst study the data to predict the stock prices to decide the buying, selling and holding the stocks.
Market Capitalization (in billions of dollars) is highest contributor for the PC1. Seems to be one of the deciding factors while clustering the data.
Now interpreting the clusters with respect to the categorical variables I can that see that these clusters are created on the basis of Median Recomendation where Market Capitalization plays an important role to tell us if we should be BUYING, SELLING or HOLDING the stocks for these pharmaceutical companies.
Median Recmmendation is a process used by analyst also known as Consensus Recomendation where Analyst study the data to predict the stock prices to decide the buying, selling and holding