The two major proxies’ advisory firms make use of in establishing peer group mainly for comparison purposes are GICS industry classification and revenue constraints such as the Market capitalization and revenue (Equilar, Inc, 2014)

The most applied method in the ways to identify company peers is through industry classification. (Frandsen and Juellund, 2019). The Manager needs this classification and peer identification to have informed perspective on the industry and its competitors determining the areas of strength, weakness, opportunities as well as the impact of strategic action on competitors. Investors on the other hand need this information to determine a company’s performance relative to other companies in the industry. (Adom, et. al., 2016).

Another important metric is identifying company’s peer by revenue constraint such as Market Capitalization and Revenue. This could also be called the net worth of a company, characterised by the total value of a companies outstanding shares. Companies similar in size and market capitalization are predicted to most likely face the same market conditions and financial metrics. A company’s revenue helps ascertain company’s peer as well and with the revenue growth rate of peer companies, a company is able to identify its market position and its potential for future expansion (Valutico, 2024). Other identification metrics for a company’s peer classification include but are not limited to Employee classification and Sector classification.

In this task we will be identifying peers of companies in these and making Justification on why they are pairs.

Table 1.

Company Name	Marriott International	Hilton Worldwide Holdings Inc	Hyatt Hotels Corporation	InterContinental Hotels Group PLC
Industry	Lodging	Lodging	Lodging	Lodging
Market Capitalization	61.18B	50.96B	13.55B	14.64B
Employee	411,000	178,000	51,000	7,292
Revenue	$6.47B	$4.62B	$6.57B	$3.82B

Marriot International: Marriott International Inc. operates in franchising and licensing hotels and other lodging properties worldwide.

It operates in the Lodging industry which has a total of 13 stocks and has a combined market cap of $164.68 billion and 29.66 billion. Based on the industry classification we have closely selected pairs that are closely associated with Marriot International in the Hotels and Lodging industry and they are Hilton Worldwide Holdings, Hyatt Hotel Corporation and Intercontinental Hotel Group PLC.

By classifying Marriot by size and revenue constraint, we look at their market capitalization as compared to others, and we see that these same companies that are grouped by industry have also shown that they are pairs in terms of their size and net worth. We have the market capitalization of 61.18B for Marriot International, whilst Hilton World Holding has a market capitalization of 50.96B, same can be said of Hyatt Hotels Corporation for 13.55B and a market capitalization of 14.64B for International Hotel Group PLC. They are all large cap companies and so qualifies to be peers under the market capitalization classification.

Classification by revenue makes us see peer classifications based on their revenue and revenue growth rate. From the table above, Marriot has a revenue of $6.47B, whilst Hilton World wide Holdings have a revenue of $4.62B, Hyatt Hotels Corporation and InterContinental Hotels Group PLC have revenues of $6.57B and $3.82B respectively.

One can see close similarities across the various peer classification in Table 1 which justifies why these companies are peer companies to Marriot International.

Table 2

Company Name	TESLA	Toyota Motors	Ford	Honda Motor Co.
Industry	Auto Manufacturers	Auto Manufacturers	Auto Manufacturers	Auto Manufacturers
Market Capital	637.04B	225.06B	40.05B	46.41B
Revenue	$95.32B	46.39T JPY	$180.35B	20.43T JPY
Employee	140,473	380,793	177,000	194,993

Tesla inc, deals with developing, manufacturing ad the sales of electric vehicles and classification by industry, (Auto manufacturers) they have close competition in Toyota Motors, which has been around for far longer than Tesla, the same can be said for Ford and Honda, so we see these companies are peers when we classify by industry.

Classification by Market Cap, although TESLA could be referred to as Mega Cap, we can see the Market Capitalization of its closest competition and peer as Toyota, Ford and Honda are regarded as Large Cap.

Classification by revenue also shows the revenue from these companies and gives us a picture of each of the Company’s market position as peers. We also have the classification by Employees as seen on the table above.

Table 3

Company Name	NVIDIA COPORATION	BROADCOM INCOPORATION	ADVANCED MICRO DEVICES	TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED
Industry	Semi Conductors	Semi Conductors	Semi Condutors	Semi Conductors
Market Capital	2.58T	678.40B	220.63B	745.82B
Employee	29,600	20,000	26,000	76,478
Revenue	$79.77B	$42.62B	$23.28B	2,438.42B TWD

Classification by Industry, we see that Nvidia shares the same industry with its company peers Broadcom incorporation, Advanced Micro Devices and Taiwan in the Semiconductors industry.
Classification by Market cap we see that Nvidia is a Mega Cap coy compared to its other pairs, but these are the closest competitions to Nvidia in the industry, this kind of gives us the picture of the net worth of Nvidia as compared to its peers.

We can also classify by Employee size, gives us an idea of each company’s labour size. Lastly classification by Revenue, shows the revenue of each of these peers in the market and gives us an idea of their market position as peer companies.

Table 4.

Company Name	Netflix	Warner Bros. Discovery, Inc.	Paramount Global	The Walt Disney Company
Industry	Entertainment	Entertainment	Entertainment	Entertainment
Market Capital	271.68B	17.22B	6.87B	156.56B
Employee	13,000	35,300	21,900	225,000
Revenue	36.30B	$29.27B	$29.27B	$90.03B

We have grouped the companies above by their industry, we identify the close peers to Netflix as Companies in the Entertainment Industry. We are also able to determine the Market cap for each of these competitors, showing us the networth of Netflix compared to its competitors. By classification by Employee, we see the work force of the closest competitors or peers in the entertainment industry and Classification by revenue shows us the market position for each of these peers. With a revenue of $36.30B and a growth rate of 13.00% in the last 12 months, Warner Bross however had a decline in growth rate of 4.67% from $41.32B, the same could be said of Paramount with a decline in growth rate by -2.20% after a $29.65B revenue the pervious year. The Walt Disney had a growth rate year on year of 2.53% from a revenue of $88.90B from the previous year. This enables investors understand the market position by peers, hence the classification by Revenue. From the table above we can also see that the company can be classified by the number of Employee they have.

V. Table 5

Company Name	Pfizer Revenue	Novartis AG (NVS)	Bristol-Myers Squibb Company	Sanofi (SNY)
Industry	Drug Manufacturers General	Drug Manufacturers General	Drug Manufacturers General	Drug Manufacturers General
Market Capital	161.78B	224.49B	94.72B	131.79B USD
Employee	88,000	76,057	34,100	86,088
Revenue	55.17B	48.86B	$46.51B	47.08B EUR

Table 5 shows the classification of Pfizer revenue by industry, shows its peers in the same industry and hence its closest competitors as Novartis AG, Bristol-Myers, Squibb Company and Sanofi. By market capitalization we see the net worth of each of these peers and they share similarities as being Large Cap companies. By revenue classification we have a picture of their market position and same can be seen of the Companies employees. By peer classification across these proxies’ investors are able to see the market size for each of a company as compare to its competitors, examine their employee number compared to a Company’s peer and also help identify market performance and similarities amongst its peers.

References

Adom, Nyarko, and Som (2016) Competitor Analysis in Strategic Management: Is it a Worthwhile. Journal of Resources Development and Management www.iiste.orgISSN 2422-8397 An International Peer-reviewed Journal Vol.24, 2016. View in: https://core.ac.uk/download/pdf/234696346.pdf

Fransend and Juellund (2019) Peer Group Selection for Multiple Valuation in a Global Setting. View in: https://research-api.cbs.dk/ws/portalfiles/portal/59794614/679883_Master_Thesis_2019_Final.pdf

S&P 1500 Peer Group Report, Equilar, (2014) View in: https://www.fwcook.com/content/Documents/Publications/S&P_1500_Peer_Group_Report.pdf