When analyzing the stock market, there are many parameters to consider. Many investors like to compare financial ratios of similar stocks. Other investors like to compare cash-flow and other information from the financial statement. One overlooked property of a company is its number of employees. The number of employees and its relation to other metrics can shed light on the capital efficiency of a company. Is is generally expected that some companies be less capital efficient and employ a large number of employees, such as large retailers like Walmart (WMT), large manufacturers and other service providers with customer-facing operations, such as banks.
Here we use Trading Lever to analyze the stock market and learn from the number of employees each company employs.
Considering Mega-Cap companies, we can easily see that the Consumer Services sector has the largest number of average employees per company, at 636 thousand employees an average per company. Expanding this sector, we can see that Walmart (WMT) tops the list with 2.2M employees, followed by Amazon (AMZN) at almost 800k employees, and then followed by Home Depot (HD) at 400k, The Walt Disney Company (DIS) at223k, Comcast (CMCSA) at 190k, and Netflix (NFLX) at 8600.
This provides us a starting point to further investigate other financial metrics that these companies possess.
This group of companies as a whole has enjoyed nice growth in its average stock price since the beginning of the pandemic (March 2020). We can also see very profitable growth in Total Revenue and Net Income for this group.
This analysis can be easily done for any other group of stocks as selected in the Trading Lever platform. For this discussion, let’s further investigate the companies in the group by clicking on their names and watching the updated plots.
Looking at the plots, it appears that most of the growth came from Amazon and Netflix, which had high double-digit stock price growth, yet revenue did not always follow at these growth levels.
Do It Yourself
This analysis has been performed using Trading Lever by Leverium. Trading Lever is a free tool to demonstrate the capabilities of Leverium, a financial planning tool. All use of Trading Lever on up-to-date stock data is 100% free.
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The Yoman Team