Is investing in companies manufacturing solar components a lucrative business? A decision tree based analysis

Sebastian Klaudiusz Tomczak*, Anna Skowronska-Szmer, Jan Jakub Szczygielski

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)
4 Downloads (Pure)

Abstract

In an era of increasing energy production from renewable sources, the demand for components for renewable energy systems has dramatically increased. Consequently, managers and investors are interested in knowing whether a company associated with the semiconductor and related device manufacturing sector, especially the photovoltaic (PV) systems manufacturers, is a money-making business. We apply a new approach that extends prior research by applying decision trees (DTs) to identify ratios (i.e., indicators), which discriminate between companies within the sector that do (designated as “green”) and do not (“red”) produce elements of PV systems. Our results indicate that on the basis of selected ratios, green companies can be distinguished from the red companies without an in-depth analysis of the product portfolio. We also find that green companies, especially operating in China are characterized by lower financial performance, thus providing a negative (and unexpected) answer to the question posed in the title.

Original languageEnglish
Article number499
JournalEnergies
Volume13
Issue number2
DOIs
Publication statusPublished - 20 Jan 2020

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