An Empirical Research on Influencing Factors of Stock Returns in the National Defense and Military Industry

Abstract

The Chinese stock market has made remarkable strides after about 30 years of growth and development. Increasing levels of public involvement in the stock market contributed greatly to the growth of the nation's economy. As the majority of investors’ financial knowledge continue to increase, people pay more and more attention to the stock return and its influencing factors. This paper chooses stock from 71 listed companies in the National Defense and Military sector of Shenyin Wanguo’s primary industry as study object, constructing a multiple linear regression model for the company financial index and the stock return from 01/01/2021 to 31/12/2021, and performing F-test and T-test. Results show that Revenue Growth rate, Return on Equity, natural logarithm of Total Assets and Debt to Asset ratio will not impact the stock yield while Price-to-Earnings ratio have significant negative influence on it. Final investment decisions can be made by investors based on the interplay of the stock market, macroeconomic environment, and current circumstances.