Abstract
The purpose of this study is to determine the significance of the effect of dividend policy on firm value. This research was conducted on property and real estate companies on the Indonesia Stock Exchange for the period 2014-2018 where the number of samples taken was 31 companies. Determination of the sample in this study using the purpose sampling method. The data analysis technique used is simple regression. The results showed that dividend policy affected the value of real estate and property companies in Indonesia. Based on the results of this study, it is expected that companies can increase prosperity to shareholders by taking into account the company's growth which shows the company is in good condition in the future. Keywords: firm value, dividend policy, dividend payout ratio, divident yield, price book value DOI : 10.7176/EJBM/11-15-02 Publication date :May 31 st 2019
Highlights
Firm value is an important concept for investors, because it is an indicator for the market to assess the company as a whole
The firm value is proxied by Price Book Value (PBV), which is the market ratio used to measure the price of a stock to its book value
PBV is formulated as: Price to Book Value (PBV) = (Stock Price per Share / Book Vale Per Share) x 100% While the independent variable is a dividend policy which in this study is operationalized by dividing profits to the shareholders of the company which is proportional to the number of sheets owned
Summary
Firm value is an important concept for investors, because it is an indicator for the market to assess the company as a whole. One of the factors that influence firm value is dividend policy. Firm value is an important concept for investors, because it is an indicator for the market to assess the company as a whole (Mahendra, 2012). According to Oka (2011) firm value is the market value of a company's securities coupled with the value of debt. There are several factors that influence the firm value , namely funding decisions, dividend policy, investment decisions, capital structure, company growth and company size, some of these factors have a relationship and influence on inconsistent firm values (Mahendra, 2012)
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