PENGARUH PROFITABILITAS, FREE CASH FLOW, DAN INVESMENT OPPORTUNITY SET TERHADAP KEBIJAKAN DIVIDEN

Abstract

This research aimed to examine and analyze the implementation of profitability, free cash flow, and investment opportunity set on the dividend policy. Furthermore, profitability measured by return on asset, free cash flow measured by operational cash shared with total assets and the investment opportunity set measured by the Market to book value of equity formula. Furthermore, this research was quantitative i.e. a research with a data source that analyzed and was able to take a conclusion. Meanwhile, the research population used LQ45 companies listed in IDX. On the other hand, the purposive sampling method obtained 28 samples each year. Therefore, during this research, it obtained 112 data. The result of this research showed that profitability had affected the dividend policy because the higher profit owned by the company it would increase the dividend policy share. Meanwhile, free cash flow did not affect the dividend policy it happened in 2016 until 2019, the companies focus on the fulfilment of the in time obligation, and it weakens the rupiah exchange. The investment Opportunity Set did not affect the dividend policy, it was caused by the company preferring to raise the investment value to achieve a better profit in the future.
Keywords: profitability, free cash flow, investment opportunity set