THE EFFECTS OF SELECTED FINANCIAL RATIOS TOWARD STOCK RETURN: A STUDY OF CONSTRUCTION INDUSTRIES IN INDONESIA FOR THE YEAR 2018 TO 2020
From the period of 2020 to 2024, The Indonesian Government, through President Jokowi, focuses on Human Resource Development (HRD). In contrast, its previous strategy, from 2014 to 2019, was focused on infrastructure development. One of the essential aspects of infrastructure is its contribution to e...
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| Format: | Theses |
| Language: | Indonesia |
| Online Access: | https://digilib.itb.ac.id/gdl/view/63184 |
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| Institution: | Institut Teknologi Bandung |
| Language: | Indonesia |
| Summary: | From the period of 2020 to 2024, The Indonesian Government, through President Jokowi, focuses on Human Resource Development (HRD). In contrast, its previous strategy, from 2014 to 2019, was focused on infrastructure development. One of the essential aspects of infrastructure is its contribution to economic growth through its previous strategy, with the Gross Domestic Product (GDP) reaching an overall 10% contribution yearly. From 2015 it has achieved 10,38% with a growing trend in 2019, 10,75% with a slight decrease to 10.71% in 2020. In 2020, the construction GDP yearly growth started to decline into a minus 3.26%. At the same time, the overall GDP of Indonesia declined to a minus 2,07% cumulative-to-cumulative (c-to-c) due to Covid-19. However, the construction industry still managed to be the fourth rank based on-field contribution. This research focuses on analyzing the selected financial ratios. The current ratio, return on asset, return on equity, debt to equity ratio, and price-earnings ratio toward the stock return of public listed in the Construction Sub-Industry in the infrastructure sector. All the data are analyzed using SPSS 25 software with multiple regression analysis methods and assumption tests. The data are gathered by secondary data based on the financial statements on the company website, with population data of 15 listed companies in the Indonesian Stock Exchange within the period of 2018 to 2020. This study confirms that all ratios simultaneously affect the stock return. Other findings also indicate that the current ratio has a significant negative effect on stock return and the price-earnings ratio has a significant positive effect on the stock return of the listed companies. |
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