- Thread starter tommy
- Start date

If you can't articulate these, then any analysis you carry out will not be very illuminating.

PCA will tell you which variables tend to "clump" together (in other words, which groups of variables or combinations of variables measure the same "concept" or "construct").

If all of the variables are related to profit in some way, then all PCA will do is confirm for you that they all "clump" together in a general construct.

If all you want to do is show which company was the most profitable, then you'll need to construct an "index" of profitability based on a combination of the financial metrics that you previously mentioned. Whichever company has the highest index is the most profitable...

tommy said:

Ok, how do i construct that?

If you're lucky, maybe someone has already conducted some research on profitability indices, and you can take advantage of their findings...

Google Scholar may be a good starting point, or maybe a university library....

tommy said:

Can i also show those saved factor scores graphically somehow?

http://www.ats.ucla.edu/STAT/spss/output/factor1.htm