Cyclical Industry

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Cyclical Industry

An industry that tends to do poorly when most of the economy as a whole is performing poorly, and well when the economy is doing well. Cyclical industries may represent publicly-traded companies that are perceived to sell luxuries or products. For example, car companies sell expensive products (cars) that many people perceive to be necessities. However, because cars are expensive, consumers in bad economic times may decide to wait to buy cars until the economy improves. On the other hand, car companies tend to do rather well when the economy is doing well.
References in periodicals archive ?
This is largely because men are more likely to be employed in highly cyclical industries, such as construction and manufacturing.
However, Casey says this constraint has loosened somewhat in the past 30 days, because of the perception among investors that cyclical industries are now in favor and that the recent economic slowdown has bottomed out and is improving.
During that time, the influx of midsize customers traditionally came from the construction and manufacturing sectors--two of the most cyclical industries.
Companies in highly cyclical industries also may opt to use non-financial measures to avoid variances that can occur in traditional financial and accounting measures.
Current law effects an especially harsh result in respect of taxpayers in cyclical industries whose ability to utilize FTCs is limited due to income fluctuations and start-up companies with initial losses.