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Abstract
The established entity has the aim to increase the value of the company. the company's stock price can be a reference for valuing a company. This study aims to test and prove empirically the effect of profitability and ownership structure on firm value with dividend policy as an intervening variable. The research data is in the form of annual company report data listed on the Indonesia Stock Exchange from 2011 to 2016. Data analysis was performed using path analysis. The results showed that profitability and dividend policy had a significant positive effect on dividend policy, while the ownership structure had no effect on dividend policy. Profitability and dividend policy variables proved to have a significant effect on firm value, while ownership structure did not affect company value.
Highlights
With increasing competition, companies need to have careful planning and good management
The research data comes from annual reports and financial reports from companies incorporated in the consumer goods industry sector which are listed on the Indonesia Stock Exchange from 2011 to 2016
This study aims to examine the value of the company that is influenced by profitability, ownership structure and dividend policy
Summary
With increasing competition, companies need to have careful planning and good management. In the decision-making process, managers must consider financial and non-financial aspects, and must be supported by a planning guideline that includes the steps needed to achieve company goals. Mahendra (2011) states that profitability and dividend policy have a positive and significant influence on firm value. This result is supported by Nofrita (2013), Windasari and Riharjo (2017), Muvidha and Suryono (2017), Hakim and Priantinah (2018), Mutmainah et al (2019), Dewi and Abundanti (2019) who state that a company's dividend policy can significantly influence the value of a company. Dividend policy is proxied by variables Dividend payout ratio (DPR) partially has no significant effect on value company manufacture which is proxied by PBV (Sukirni, 2012 and Mardiyati et al, 2012)
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