THE EFFECT OF KEY FINANCIAL RATIOS ON SHARE RETURNS IN CONSTRUCTION COMPANIES LISTED IN INDONESIA STOCK EXCHANGE (IDX)
In this study, the author has conducted a regression analysis to determine the relationship between share return and selected financial ratios, namely Debt to Equity Ratio (DER), Net Profit Margin (NPM), Price Earning Ratio (PER), Price to Book Value (PBV) and Current Ratio (CR) in construction c...
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| Format: | Theses |
| Language: | Indonesia |
| Subjects: | |
| Online Access: | https://digilib.itb.ac.id/gdl/view/64007 |
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| Institution: | Institut Teknologi Bandung |
| Language: | Indonesia |
| Summary: | In this study, the author has conducted a regression analysis to determine the
relationship between share return and selected financial ratios, namely Debt to
Equity Ratio (DER), Net Profit Margin (NPM), Price Earning Ratio (PER), Price
to Book Value (PBV) and Current Ratio (CR) in construction companies listed in
the Indonesia Stock Exchange for the period of 2016 to 2020. Data that used by the
author is secondary data from several sources such as the Indonesia Stock Exchange
(IDX), the company financial statements, and the other reliable sites. The sample
set for this study comprise 11 construction companies listed in the Indonesia Stock
Exchange for the period of 2016 to 2020.
This study determines that NPM and PBV individually have a significant positive
effect on Share Return. While PER and CR individually have a significant negative
effect on Share Return. Lastly, DER individually does not show a significant effect
on Share Return. Simultaneously DER, NPM, PER, PBV, CR have a significant
effect on Share Return. For potential investors the result from this study is important
to make decision in stock market transaction and it also give benefit to companies
in the construction sector to improve their financial performance.
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