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The Effect of Company Size, Liquidity, and Profitability on Company Value
Subject area: Management and Commerce · Area of research: Economy and Business
Abstract
The study aims to examine the factors that affect the value of a company. The data used in the study are trading companies listed on the Indonesia Stock Exchange from 2018 to 2022. Data sampling technique using purposive sampling. Data obtained from the website of manufacturing companies and the website of the Indonesia Stock Exchange. The research hypothesis was tested using regression analysis with SPSS 25. The results showed that firm size, liquidity and profitability affect firm value. This study shows that firm size has an impact on firm value, where the larger the firm size, the higher the firm value, then a good level of liquidity can support the firm's ability to meet financial obligations and provide flexibility in decision making, which in turn contributes to an increase in firm value, and companies that achieve higher levels of profitability tend to have higher value in the eyes of investors. This research can help investors as stakeholders to consider strategies and policies that focus on increasing size, liquidity and profitability as an effort to increase firm value in a sustainable manner.
Keywords
Company size, Liquidity, Profitability, and Firm value.
How to cite this paper
@article{1705202,
author = {Aris Sugiarto, Sriyatun},
title = {The Effect of Company Size, Liquidity, and Profitability on Company Value},
journal = {Iconic Research And Engineering Journals},
year = {2023},
volume = {7},
number = {5},
pages = {83-90},
issn = {2456-8880},
url = {https://www.irejournals.com/formatedpaper/1705202.pdf},
abstract = {The study aims to examine the factors that affect the value of a company. The data used in the study are trading companies listed on the Indonesia Stock Exchange from 2018 to 2022. Data sampling technique using purposive sampling. Data obtained from the website of manufacturing companies and the website of the Indonesia Stock Exchange. The research hypothesis was tested using regression analysis with SPSS 25. The results showed that firm size, liquidity and profitability affect firm value. This study shows that firm size has an impact on firm value, where the larger the firm size, the higher the firm value, then a good level of liquidity can support the firm's ability to meet financial obligations and provide flexibility in decision making, which in turn contributes to an increase in firm value, and companies that achieve higher levels of profitability tend to have higher value in the eyes of investors. This research can help investors as stakeholders to consider strategies and policies that focus on increasing size, liquidity and profitability as an effort to increase firm value in a sustainable manner.},
keywords = {Company size, Liquidity, Profitability, and Firm value.},
month = {November},
}