The Effect of Profitability, Firm Value, and Leverage on Stock Return before and During Covid-19 in Healtycare Sector Companies

Abstract

The Covid-19 pandemic has greatly affected the economy of all countries so that it is considered a black swan which has an impact on almost all aspects of life. However, there are companies that actually benefit from the Covid-19 pandemic, namely companies in the health care sector, because the need for products produced by companies in this sector is really needed during the pandemic. This study aims to examine the effect of profitability, firm value, leverage and company size on stock returns in healthcare sector companies both before, during and after the Covid-19 pandemic. Profitability is measured by return on assets, firm value is measured by the price to book value ratio, leverage is measured by the debt-to-equity ratio and firm size is measured by the natural logarithm of total assets. The population of this study is the health care sector companies that are on the Indonesia Stock Exchange as many as 24 companies and all of them are taken as samples. The data collection period is from 2018 to 2022, with quarterly data. This study uses multiple regression analysis to test the hypothesis. The results of the study show that profitability and leverage have no significant effect on stock returns before, during and after Covid. Meanwhile, PBV has a positive and significant effect on stock returns both before, during and after Covid. Meanwhile, firm size has an effect on stock returns during and after Covid 19