Renewable Energy Firm’s Performance Analysis Using Machine Learning Approach

Disclosure Dynamics and Non-Financial Reporting Analysis. The Case of Romanian Listed Companies

“…Empirical studies [49,58,59] conducted on companies from sensitive industries analyze the financial performance of listed companies in the energy sector, seeking to identify links between the sustainable actions of companies and their financial performance. From studies conducted by Paun [58] and Rastogi et al [59], we found out that the performance of companies is strongly influenced by government policies. For these companies to perform, the government needs to establish policies that motivate these companies to invest more in sustainable development.…”

“…As appreciated by Zhao [49] through the return on capital employed (ROCE) indicator, excellent sustainability performance can achieve excellence in the power generation industry. Paun [58] and Rastogi et al [59] assessed the performance of companies through the financial indicator ROE while Kurochkina et al [60] measured the performance of sustainable business undertaken by Russian companies, in terms of value creation indicators. They considered that a whole image of the created value is given by an approach from three points of view: the intrinsic value of the company, the overall capitals, respectively the created value influenced by interested parties.…”

A Literature Review of Net Profit Margin

“…Jensen et al (2020) observed a tendency of positive relationships between individualized consideration and firm performance and these findings remained significant after controlling for company baseline performance, firm size, CEO tenure, and company location, finally the findings largely support the positive role of CEO transformational leadership in shaping firm performance. Rastogi et al (2020) identify the trend in the financial performance of the Indian and US based renewable energy companies by utilizing k-means cluster of machine learning algorithm, furthermore, the trends that emerged from the cluster analysis are studied alongside the major events that took place both internal and external to the firm and the government regulations and changes in tariff policies have emerged to be the common factors in determining the firm's future. For the developed economy such as the US, an announcement by a global governing body or a spat between two countries over terms of trade can seriously affect the performance of concerned companies, hence, it is concluded that the tariff rates and policies for renewable energy companies need to be framed in a manner to encourage the firms to increase their investments towards the clean energy production (Rastogi et al, 2020).…”

“…Rastogi et al (2020) identify the trend in the financial performance of the Indian and US based renewable energy companies by utilizing k-means cluster of machine learning algorithm, furthermore, the trends that emerged from the cluster analysis are studied alongside the major events that took place both internal and external to the firm and the government regulations and changes in tariff policies have emerged to be the common factors in determining the firm's future. For the developed economy such as the US, an announcement by a global governing body or a spat between two countries over terms of trade can seriously affect the performance of concerned companies, hence, it is concluded that the tariff rates and policies for renewable energy companies need to be framed in a manner to encourage the firms to increase their investments towards the clean energy production (Rastogi et al, 2020). Srinivasan (2020) found that affected firms are more likely to make acquisitions following tariff reductions and found some evidence that the acquisitions made in response to tariff decreases are associated with better firm profitability ratios in the following year, indicating that firms respond to increased competition by making acquisitions to improve their operational efficiency.…”

Is It Possible to Make Money on Investing in Companies Manufacturing Solar Components? A Panel Data Approach

“…Following a consideration of 16 ratios for 37 companies located in Baltic and Central European countries, Tomczak [28] finds that RES companies exhibit lower returns on assets and returns on equity relative to fossil fuel producers suggesting that RES companies are not as profitable as fossil fuel companies, which are shown to be more profitable. Rastogi et al [29] report upon the trend of ROE for Renewable Energy companies (RES companies) in India and the United States. They argue that given the large investment required to develop renewable energy sources, the renewable energy sector needs to exhibit profitability or the potential for profitability in the future in order to attract investors.…”