Blog: Statistical Analysis of Financial Measures in S&P 100 Companies as of 04-08-2024

Introduction

In this blog post, we delve into the financial metrics of S&P 100 companies, providing a comprehensive statistical analysis of various key indicators. By examining measures such as Earnings Per Share (EPS), Price to Earnings (P/E) Ratio, Price to Book (P/B) Ratio, Dividend Yield, Return on Equity, Debt to Equity, Free Cash Flow, Market Capitalization, and Revenue Growth, we aim to uncover insights into the financial health and performance of these major companies.

Methodology

We analyzed a dataset containing the latest financial metrics for S&P 100 companies. The data includes various financial measures that are pivotal for investors and stakeholders to understand the market positioning and financial stability of these corporations. Our analysis includes descriptive statistics and distribution plots to provide a clear visual and quantitative understanding of each financial measure.

Statistical Overview

Here's a brief statistical summary of the key financial measures:

• Earnings Per Share (EPS): A crucial indicator of a company's profitability, with an average of 8.56 and a wide range, indicating varied profitability across the companies.
• Price to Earnings (P/E) Ratio: With an average of 40.95, this metric varies significantly, highlighting diverse valuations.
• Price to Book (P/B) Ratio: The average stands at 13.45, but the range is quite broad, reflecting varied asset valuations.
• Dividend Yield: On average, companies offer a 2.70% yield, with some variability, showing different dividend policies.
• Return on Equity: Averaging at 2.85, the return on equity shows how effectively companies generate profits from shareholders' equity.
• Debt to Equity: With an average of 233.25, this ratio points to varying levels of financial leverage among the companies.
• Free Cash Flow: Averaging at $9.87 billion, this measure indicates the cash available for distribution among shareholders.
• Market Capitalization: With a colossal average of $323.87 billion, market caps vary widely, indicating a range of company sizes.
• Revenue Growth: The average growth rate is 6.27%, showcasing how companies are expanding their revenues.

Distribution Analysis

We created distribution plots for each financial measure, adding mean and median values for a clearer understanding. These plots revealed:

• Skewed Distributions: Many metrics, like EPS and P/B Ratio, show skewed distributions, indicating that a few large values significantly impact the average.
• Variability: The wide range of values in metrics like the P/E Ratio and Debt to Equity indicates considerable variability among the companies in the S&P 100.
• Central Tendencies: By marking mean and median values, we highlighted the central tendencies, showing where most companies fall within each distribution.

Conclusion

The financial metrics of S&P 100 companies offer a fascinating glimpse into the corporate giants' financial health and strategies. The analysis reveals significant variability across different financial measures, reflecting the diverse strategies and market conditions faced by these companies. For investors and stakeholders, understanding these metrics and their distributions can provide valuable insights for making informed decisions.