You are here

Economics in a picture

Economics in a picture

In the recent period, higher investment rate firms have higher profitability


The past few years have been marked by a recovery in firms’ investment. In order to analyze in a timely manner the characteristics of the firms that invest the most in Portugal, it is useful to use the accounting data reported under the quarterly survey of non-financial corporations (ITENF, in its Portuguese acronym), carried out jointly by the INE and the Banco de Portugal. In this analysis, investment was considered as the change of tangible and intangible fixed assets plus depreciation in the period, as a percentage of the firms’ total assets. This measure, hereinafter referred to as the investment rate, makes it possible to analyze which firms have invested the most relatively to its size. The analysis includes the period between the second quarter of 2018 and the first quarter of 2019.

As shown in the chart, the firms that invested the most (4th quartile of the investment rate) were the ones with the highest profitability on average, calculated as the ratio of operating income (EBITDA) to total assets. On the contrary, the firms that invested the least (1st quartile of the investment rate) were the ones with the lowest profitability on average.


For more details see Box 2: “Firms’ investment and leverage in Portugal”, published in the Economic Bulletin of Banco de Portugal, October 2019.

Prepared by Pedro Moreira. The analyses, opinions and findings expressed above represent the views of the author and not necessarily those of Banco de Portugal or the Eurosystem.


If you want to receive an e-mail whenever a new “Economics in a picture” is published send your request to