bbvista pp economic and industry analysis

Notwocyclesareexactlyaliketherefore

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Unformatted text preview: term: Demand and supply Long­term: Industry structure Industry structure is determined by Michael Porter’s Five Forces Cyclical Changes Cyclical Changes Arise from fluctuations in the business cycle resulting from fluctuations in interest rate, inflation, exchange rates, changes in GDP Industry performance is related to the stage of the business cycle. No two cycles are exactly alike; therefore industry analysis is not an exact science. Michael Porter’s Five Forces Michael Porter’s Five Forces 1. 2. 3. 4. 5. Threat of New Entrants Threat of substitute products Bargaining power of buyers Bargaining power of suppliers Rivalry between firms The business cycle The business cycle Peak Interest sensitive stocks QuickTime™ and a decompressor are needed to see this picture. Consumer staples Capital goods, Real Estate Trough Financial Stocks Consumer durables, commodities Business Cycle and Industry Business Cycle and Industry Classification Growth Industry ­ Sales↑ through all phases of Business Cycle Cyclical Industry ­ Sales↑ with Demand Defensive Industry­ Demand for product is independent of Business Cycle, External Factors affecting External Factors affecting Profitability 1. 2. 3. 4. 5....
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This document was uploaded on 02/05/2014.

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