Core Viewpoint - Industry profit forecasting has a positive effect on stock price performance, with long-term returns decomposed into dividend yield, profit growth rate, and price-earnings ratio changes [3][9] Group 1: Industry Profit Forecasting - Profit growth rate is the core driver of stock value growth and is more predictable than price-earnings ratio changes [3][9] - Forecasting profit growth can enhance the performance of industry portfolios, with a hypothetical high-growth portfolio outperforming equal-weighted and low-growth portfolios [3][9] - The industry prosperity model reflects future industry profit status through demand and supply indicators, providing support for stock price return predictions [3][11] Group 2: LLM Empowerment in Model Construction - LLM improves the efficiency of constructing industry prosperity models by enhancing qualitative analysis and indicator selection [4][5] - A structured process using LLM for qualitative screening and quantitative testing results in a reliable industry prosperity index that predicts profit growth [5][17] - The constructed prosperity index shows predictive capability for future profit growth, with average and median rank correlation coefficients around 0.25 across different industry levels [5][26] Group 3: Application of Industry Prosperity Index - The industry prosperity index has various applications, including industry timing, rotation, stock selection, and risk warning [6][38] - High-prosperity industry portfolios demonstrate superior long-term performance compared to equal-weighted portfolios, with annualized excess returns of 2.4%, 2.9%, and 2.8% for different industry levels [6][7] - Sensitivity tests indicate that high-prosperity portfolios maintain stable excess returns over time, outperforming low-prosperity and equal-weighted portfolios [50][43]