Macroeconomic drivers of financial performance in power generation firms across emerging and developed marketsERATION FIRMS ACROSS EMERGING AND DEVELOPED MARKETS

This study examines the impact of macroeconomic factors on the financial performance of power generation firms, comparing emerging Latin American economies with those of a developed market. Based on panel data from 106 companies across six countries (2018–2022), multilevel modeling is used to assess firm- and country-level effects, complemented by Dual Multiple Factor Analysis (DMFA) to identify latent relationships among financial and macroeconomic variables. The results indicate that exchange rate fluctuations and inflation are significant determinants of return on equity (ROE), with coefficients of 0.57 and −0.32, respectively. Internal indicators, such as gross profit margin (β = 0.30) and quick ratio (β = 0.22), also exhibit strong positive associations with ROE. Differences in macroeconomic sensitivity between developed and emerging markets underscore the importance of context-specific financial strategies in the energy sector.