What is a cyclical business cycle?

When the economy is growing or expanding, these companies grow, and when the economy is in a recession or depression, they decline. An industry classified as cyclical is sensitive to the business cycle, which results in higher revenues during periods of economic expansion, but lower revenues during periods of economic contraction and downturn.

What is a cyclical industry?

A cyclical industry is an industry with a strong correlation to the broader economy. Cyclical companies tend to see profits rise along with the rest of the economy, and fall during periods of recession.

What is a cyclic company?

Cyclical companies tend to be in industries like durable goods or construction, where a small change in consumer discretionary income can cause a sharp reduction in company profits. Investopedia requires writers to use primary sources to support their work.