IDEAS home Printed from https://ideas.repec.org/a/rnd/arimbr/v8y2016i1p23-29.html
   My bibliography  Save this article

Effect of Capital Structure, Company Size and Profitability on the Stock Price of Food and Beverage Companies Listed on the Indonesia Stock Exchange

Author

Listed:
  • Sitti Murniati

Abstract

The purpose of this study was to analyze the effect of capital structure proxy for debt to asset ratio (DAR) and the debt to equity ratio (DER), company size and profitability are proxied by return on assets (ROA), return on equity (ROE) and net profit margin (NPM) to the stock price on the company's Food and Beverage listed on the Indonesia Stock Exchange. This study uses Associative approach. The population in this study is the Food and Beverage companies listed in Indonesia Stock Exchange year period 2011 to 2014. Sampling method used is purposive sampling and the amount of samples obtained is 11 companies with 44 observations. Hypotheses were tested using multiple regression analysis. Results of the study were 1) capital structure proxy for debt to asset ratio (DAR) significant negative effect on stock prices, this means that if a decline in the value of DAR, the stock price will rise, 2) capital structure proxy for debt to equity ratio (DER) significant positive effect on stock prices, it means that the higher the value of DER then be followed by a decrease in stock prices, 3) The company size significant positive effect on stock prices, this suggests that the relationship between the SIZE with stock prices in the same direction, if SIZE increases, the stock price will increase, 4) profitability is proxied by return on assets (ROA) significant positive effect on stock prices, this means that the assets of the company to make a profit can affect stock prices, 5) profitability proxied with a return on equity (ROE) significant negative effect, this means that if a decline in ROE it will be followed by a decrease in stock prices, and 6) Profitability which is proxied by net profit margin (NPM) significant negative effect on stock prices, this means that while the net profit increased, the total sales will rise this is due to the high costs incurred by the company so that NPM has no effect on stock prices.

Suggested Citation

  • Sitti Murniati, 2016. "Effect of Capital Structure, Company Size and Profitability on the Stock Price of Food and Beverage Companies Listed on the Indonesia Stock Exchange," Information Management and Business Review, AMH International, vol. 8(1), pages 23-29.
  • Handle: RePEc:rnd:arimbr:v:8:y:2016:i:1:p:23-29
    DOI: 10.22610/imbr.v8i1.1192
    as

    Download full text from publisher

    File URL: https://ojs.amhinternational.com/index.php/imbr/article/view/1192/1186
    Download Restriction: no

    File URL: https://ojs.amhinternational.com/index.php/imbr/article/view/1192
    Download Restriction: no

    File URL: https://libkey.io/10.22610/imbr.v8i1.1192?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. H M Sifullah & Parvin Akater Shelly & Dr. Mohammad Nazim Uddin & Tanbina Tabassum & Md Ahsan Uddin, 2024. "Does Financial Leverage Impact the Financial Performance of Pharmaceutical Companies in Bangladesh?," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(2), pages 37-63.
    2. Varvara Nazarova & Golovina Olga & Volosatova Ksenia & Yarusova Ksenia, 2022. "Drivers’ estimation of the luxury companies," DECISION: Official Journal of the Indian Institute of Management Calcutta, Springer;Indian Institute of Management Calcutta, vol. 49(1), pages 105-128, March.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rnd:arimbr:v:8:y:2016:i:1:p:23-29. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Muhammad Tayyab (email available below). General contact details of provider: https://ojs.amhinternational.com/index.php/imbr .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.