The Effect of Profitabilty, Debt Policy and Firm Size on Company Value in Consumer Goods Companies

Abstract

Investor's perception of the company will be seen through the company's performance which is reflected by the Company's Value. High company value will increase the bargaining power of the company and provide added value for shareholders and investors who want to invest in the company.The objective of the research was to examine and analyze the influence of Profitability Ratio (Gross Profit Margin/GPM, Operating Profit Margin/OPM, Net Profit Margin/NPM, Return On Assets/ROA, Return On Equity/ROE), Debt Policy (Debt Equity Ratio/DER) and Firm size (Assets Size) on the Company Value (Price Earning Ratio/PER) in consumer goods companies listed in the Indonesia Stock Exchange. The research used causal research method and secondary data. The population was 47 consumer goods companies listed in the Indonesia Stock Exchange in the period of 2015-2017, and 23 of them were used as the samples, taken by purposive sampling technique. The data were analyzed by using multiple linear regression analysis. The results showed that simultaneously Gross Profit Margin (GPM), Operating Profit Margin (OPM), Net Profit Margin (NPM), Return On Assets (ROA), Return On Equity (ROE) and Debt Policy (Debt Equity Ratio / DER) significantly influence the Company Value (Per Earning Ratio / PER) with a calculated F value of 0,000. Partially, Gross Profit Margin (GPM) and Company Size (Assets Size) have a significant effect on Company Value (PER), with a t value of 0,000, while Operating Profit Margin (OPM), Net Profit Margin (NPM), Return On Assets (NPM) ROA), Return On Equity (ROE) and Debt Policy (Debt Equity Ratio / DER) have no effect on the Company Value (Per Earning Ratio) with t count values of 0.89, 0.831.0.757.0.864.0.827, respectively. With R Square 0, 348 = 34.8%, meaning that only 34.8% of the variables studied could affect the value of the company while 62.2% is influenced by other variables that were not researched.