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Abstract
This study aims to analyze the effect of institutional ownership, operating leverage, liquidity on firm value with company performance as an intervening in oil and gas mining companies listed in Indonesia Stock Exchange (IDX) between 2014-2018. A total of 10 companies classified in on the Indonesia Stock Exchange in the oil and natural gas mining sub-sector were used as sample, making the number of assessments to be 50 observations within a span of 5 years of 2014-2018. Data analysis using Partial least squares/PLS analysis with Structural Equation Modeling/SEM analysis model. The results of the study revealed that institutional ownership, operating leverage and liquidity have a positive influence on firm value. The mediating test by using the Sobel test showed that the firm's performance is able to mediate the effect of institutional ownership, operating leverage, liquidity on the the value of oil and gas companies in IndonesiaKeywords: energy companies, institutional ownership, operating leverage, liquidity, firm value, firm performanceJEL Classifications: L25, Q43DOI: https://doi.org/10.32479/ijeep.9567
Highlights
Increased demand for crude oil combined with concerns about its availability caused oil prices to reach record highs in history in the 2000s (Hamilton, 2009)
The object of research is to analyse the effect of institutional ownership, operational leverage, liquidity and company performance on the oil and gas mining company value listed in Indonesian stock exchange between 2014 and 2018
Based on previous theoretical studies, this study empirically analyzed the relationship between institutional ownership, operating leverage, liquidity and financial performance effects on the oil and gas mining company in Indonesia (Figure 1)
Summary
Increased demand for crude oil combined with concerns about its availability caused oil prices to reach record highs in history in the 2000s (Hamilton, 2009). The lack of exploration and other investments in the oil sector has caused a decline in Indonesia’s oil production due to weak management from the government, excessive bureaucracy, unclear regulatory framework and unclear legal terms regarding contracts (SKK Migas, 2019). This creates an investment climate that is not attractive to investors, especially if it involves expensive long-term investment
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