FINANCIAL PERFORMANCE, ECONOMIC VALUE ADDED, AND STOCK RETURN OF PHARMACEUTICAL COMPANIES
The Covid-19 pandemic that has lasted almost two years has the potential to create opportunities to encourage domestic pharmaceutical industry production, resulting in a significant increase in demand for pharmaceutical commodities and medical devices related to Covid-19 handling. However, the ph...
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id-itb.:637062022-02-24T18:33:16ZFINANCIAL PERFORMANCE, ECONOMIC VALUE ADDED, AND STOCK RETURN OF PHARMACEUTICAL COMPANIES Azahra, Nabila Manajemen umum Indonesia Theses Financial Performance, Financial Ratios, Economic Value Added, Pharmaceutical Companies, Pandemic INSTITUT TEKNOLOGI BANDUNG https://digilib.itb.ac.id/gdl/view/63706 The Covid-19 pandemic that has lasted almost two years has the potential to create opportunities to encourage domestic pharmaceutical industry production, resulting in a significant increase in demand for pharmaceutical commodities and medical devices related to Covid-19 handling. However, the pharmaceutical sector is facing many obstacles, including Large-Scale Social Restrictions (PSBB), Work from Home, and other health regulations, to sustain the company's solid financial performance in the long run. To thrive in the pharmaceutical sector in the face of the obstacles mentioned earlier, each company must maintain its financial performance. This research is included in the type of descriptive research using a quantitative approach, with the sample of 9 pharmaceutical companies listed in the Indonesia Stock Exchange for 2016-2020. The author will use indicators of the company's financial performance assessment using financial ratios, such as Current Ratio (CR), Debt-to-Equity Ratio (DER), Total Assets Turnover (TATO), and Economic Value Added (EVA). This study will also assess the relationship between the company's financial performance using financial ratio and EVA analysis to the company's stock return using panel data regression model and hypothesis testing, partially or simultaneously using t-test and F test. Based on the financial ratio analysis, three categories of financial ratios give different implications for each company. Based on the economic value-added analysis, companies with negative EVA should improve their performance by projecting it to move into positive territory. Based on the statistical tools’ analysis using EViews 10, it can be concluded that the Current Ratio and Debtto-Equity Ratio accepted the partial hypothesis test that both ratios have a significant effect on stock return. At the same time, Total Assets Turnover and EVA rejected the partial hypothesis test that both ratios have no significant effect on stock return. Simultaneously, CR, DER, TATO, and EVA, have no significant effect on stock return. It can be seen that investors should steer clear of firms with poor financial performance, particularly those with constantly negative EVA. Fundamental performance, as reflected by the financial ratios of pharmaceutical companies, can be affected by the uncertainty of the pharmaceutical industry. Therefore, future research can add another control variable as a determinant of a company's financial condition that may significantly affect the company's stock return. Future research may also consider the internal factors of the companies and external factors that may occur to increase the accuracy of their performance assessment, especially during the bizarre phenomenon of the Covid-19 Pandemic. text |
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Manajemen umum Azahra, Nabila FINANCIAL PERFORMANCE, ECONOMIC VALUE ADDED, AND STOCK RETURN OF PHARMACEUTICAL COMPANIES |
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The Covid-19 pandemic that has lasted almost two years has the potential to create opportunities
to encourage domestic pharmaceutical industry production, resulting in a significant increase in
demand for pharmaceutical commodities and medical devices related to Covid-19 handling.
However, the pharmaceutical sector is facing many obstacles, including Large-Scale Social
Restrictions (PSBB), Work from Home, and other health regulations, to sustain the company's
solid financial performance in the long run. To thrive in the pharmaceutical sector in the face of
the obstacles mentioned earlier, each company must maintain its financial performance. This
research is included in the type of descriptive research using a quantitative approach, with the
sample of 9 pharmaceutical companies listed in the Indonesia Stock Exchange for 2016-2020.
The author will use indicators of the company's financial performance assessment using financial
ratios, such as Current Ratio (CR), Debt-to-Equity Ratio (DER), Total Assets Turnover (TATO),
and Economic Value Added (EVA). This study will also assess the relationship between the
company's financial performance using financial ratio and EVA analysis to the company's stock
return using panel data regression model and hypothesis testing, partially or simultaneously using
t-test and F test.
Based on the financial ratio analysis, three categories of financial ratios give different implications
for each company. Based on the economic value-added analysis, companies with negative EVA
should improve their performance by projecting it to move into positive territory. Based on the
statistical tools’ analysis using EViews 10, it can be concluded that the Current Ratio and Debtto-Equity
Ratio accepted the partial hypothesis test that both ratios have a significant effect on
stock return. At the same time, Total Assets Turnover and EVA rejected the partial hypothesis
test that both ratios have no significant effect on stock return. Simultaneously, CR, DER, TATO,
and EVA, have no significant effect on stock return. It can be seen that investors should steer
clear of firms with poor financial performance, particularly those with constantly negative EVA.
Fundamental performance, as reflected by the financial ratios of pharmaceutical companies, can
be affected by the uncertainty of the pharmaceutical industry. Therefore, future research can add
another control variable as a determinant of a company's financial condition that may significantly
affect the company's stock return. Future research may also consider the internal factors of the
companies and external factors that may occur to increase the accuracy of their performance
assessment, especially during the bizarre phenomenon of the Covid-19 Pandemic.
|
format |
Theses |
author |
Azahra, Nabila |
author_facet |
Azahra, Nabila |
author_sort |
Azahra, Nabila |
title |
FINANCIAL PERFORMANCE, ECONOMIC VALUE ADDED, AND STOCK RETURN OF PHARMACEUTICAL COMPANIES |
title_short |
FINANCIAL PERFORMANCE, ECONOMIC VALUE ADDED, AND STOCK RETURN OF PHARMACEUTICAL COMPANIES |
title_full |
FINANCIAL PERFORMANCE, ECONOMIC VALUE ADDED, AND STOCK RETURN OF PHARMACEUTICAL COMPANIES |
title_fullStr |
FINANCIAL PERFORMANCE, ECONOMIC VALUE ADDED, AND STOCK RETURN OF PHARMACEUTICAL COMPANIES |
title_full_unstemmed |
FINANCIAL PERFORMANCE, ECONOMIC VALUE ADDED, AND STOCK RETURN OF PHARMACEUTICAL COMPANIES |
title_sort |
financial performance, economic value added, and stock return of pharmaceutical companies |
url |
https://digilib.itb.ac.id/gdl/view/63706 |
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