Evaluation of industrial companies listed on the Palestine Exchange based on their financial performance using multi-criteria techniques

Abstract

The industrial sector is one of the important sectors in the field of business and investment for decision makers and investors. Accordingly, evaluating the financial performance of companies operating in this sector is a key factor in determining the destination of investors. The evaluation process includes contradictory criteria and information that complicates the evaluation process and fails to build a reliable and accurate financial performance of the company. This study aims to evaluate the financial performance of the industrial companies listed on Palestine Stock Exchange between 2017 to 2021 by defining a set of (16) financial ratios covering areas of (liquidity, activity, indebtedness, profitability, market, and growth). The entropy method is used to identify the relative weights of criteria, and then the financial performance of industrial companies is analyzed and assessed using multi-criteria decision-making techniques of TOPSIS and VIKOR. The most important result of the study is the ranking of the industrial companies from best to worth. Also, the study recommended with confidence the strength of the financial performance of each of the Vegetable Oil Industries Co. and Birzeit Pharmaceutical Co., and accordingly investors can be advised to invest in these companies taking into consideration risk and benefiting from investment portfolios.