The Effect of Profitability and Liquidity on Firms Value

DOI

10.2991/aebmr.k.220701.025How to use a DOI?

Keywords

Profitability; Liquidity; Firms Value

Abstract

This study aims to determine the description of Profitability as measured by Return on Equity (ROE), Liquidity as measured by the Current Ratio (CR) and Firm Value as measured by Price to Book Value (PBV) and the influence between these variables. This research uses descriptive and verification research methods. This research was conducted on 4 companies in the Cosmetics and household goods sub-sector listed on the Indonesia Stock Exchange (IDX) with data ranging from 2011-2018. Samples were taken using purposive sampling technique with several criteria. Because the data are panel data, to test the effect between variables, panel regression analysis is used. The research findings show that profitability has a positive and significant effect on firm value. Furthermore, liquidity has a negative and insignificant effect on firm value. The results of the model fit test show that simultaneously profitability and liquidity have an effect on firm value.

Copyright

© 2022 The Authors. Published by Atlantis Press International B.V.

Open Access

This is an open access article distributed under the CC BY-NC 4.0 license.

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TY  - CONF
AU  - Ratu Dintha IZFS
AU  - Eded Tarmedi
AU  - Yusuf Murtadlo Hidayat
AU  - Ahim Surachim
AU  - Christy Debora
PY  - 2022
DA  - 2022/07/12
TI  - The Effect of Profitability and Liquidity on Firms Value
BT  - Proceedings of the 6th Global Conference on Business, Management, and Entrepreneurship (GCBME 2021)
PB  - Atlantis Press
SP  - 125
EP  - 130
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.220701.025
DO  - 10.2991/aebmr.k.220701.025
ID  - IZFS2022
ER  -