Abstract
This study aims to examine the effect of leverage, profitability, and dividend policy variables on firm value in property and real estate companies listed on the Indonesia Stock Exchange for the 2018-2020 period. This type of research is causal associative. The research population is 64 companies. The sample was determined by purposive sampling technique as many as 11 companies. Data analysis used multiple linear regression analysis. The test results show that leverage as proxied by debt to equity ratio (DER) has no significant effect on firm value, profitability proxied by return on equity (ROE) has a significant effect on firm value, and dividend policy proxied by dividend payout ratio (DPR) has no significant effect on the value of the company. Investors pay more attention to the company's ability to earn profits and its management.
Highlights
In an increasing competitive era of industrialization, every company must continuously improve its competitiveness due to increasing competition in both domestic and international markets
This study examines the effect of leverage, profitability, and dividend policy on firm value
Based on data analysis, hypothesis testing and discussions that have been carried out on property and real estate sector companies listed on the Indonesia Stock Exchange in 2018-2020, it can be concluded as follows: (1) Leverage has no effect on firm value
Summary
In an increasing competitive era of industrialization, every company must continuously improve its competitiveness due to increasing competition in both domestic and international markets. The value of the company that is formed through the stock market value indicator is strongly influenced by investment opportunities. The existence of investment opportunities published by the management in the form of financial statements gives a positive signal about the company's growth in the future so that it can increase the value of the company. This is in line with signal theory [2] that the executive, namely the company, has better information and will convey information to potential investors so that stock prices increase. Increasing the stock price means increasing the return that will be obtained by potential investors. [3] state that this theory reveals that investors can distinguish between companies that have high values and vice versa
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