The Effect of Profitability, Intangible Asset, and Leverage on Dividend Policy and Firm Value

Abstract

The increasing population in Indonesia has resulted in the need for consumption of primary goods to be very rapid. In addition, economic development has made competition increasingly fierce in the world of trade, which operates in various sectors, for example in consumer noncyclicals companies. This study aims to examine the effect of profitability, intangible assets, leverage on dividend policy and corporate value of main board index companies in the consumer non-cyclicals sector on the Indonesian stock exchange during the 2017-2021 period. Profitability is measured by return on assets (ROA), intangible assets are measured by the logarithm of the book value of intangible assets (IAS), leverage is measured by the debt to equity ratio (DER), dividend policy is measured by the dividend payout ratio (DPR) and company value is measured by price to book value (PVB). The population of this study is the health sector companies that are on the Indonesia Stock Exchange as many as 57 companies and 26 are taken as samples. The data collection period is from 2017 to 2021, with annual data. This study uses multiple linear regression analysis to test the hypothesis. The results show that profitability and leverage have no significant effect on dividend policy. Meanwhile, intangible assets have a negative and significant effect on dividend policy. Profitability and leverage have no significant effect on firm value. Meanwhile, intangible assets and dividend policy have a positive and significant effect on dividend policy.