Information on Cash Flow Statements and Stock Return

Abstract

This research aims to test and analyze information from the cash flow statement on the share return. The cash flow intended is from operating, financing, and investing activities. Meanwhile, the shares utilized belong to the infrastructure, utility, and telecommunication companies listed on the Indonesian capital market between 2018 and 2021. Because this study uses the change in three cash flows, the secondary data from 2017 to 2021 based on the firm annual reports and the stock price at the end of these years are employed. Additionally, the t-statistics and their probability provided by a multiple regression model to statistically examine the hypotheses proposed are applied. Finally, this study concludes that the higher the cash flow from investing activities, the higher the stock return. However, the positive change in the financing cash flow tends to reduce this return. Meanwhile, this return is not affected by the cash flow from operating activities.