PENGARUH PROFITABILITAS, LIKUIDITAS, DAN LEVERAGE TERHADAP NILAI PERUSAHAAN

Abstract

This research aimed to examine the effect of Profitability, Liquidity, and Leverage on firm value. While
profitability was referred to Return On Asset (ROA), Liquidity was referred to Current Ratio (CR), and
Leverage was referred to Debt to Equity Ratio (DER). The research was quantitative. Moreover, the
data collection technique used purposive sampling. In line with that, there were 180 observations from
45 samples of banking companies which were listed on Indonesia Stock Exchange during 2017-2020.
Furthermore, the data analysis technique used multiple linear regression. The research result
concluded as follows: (a) ROA had a positive effect on firm value. It meant, the higher the profitability
was, the more interest from investors in doing investment would be, (b) CR had a negative effect on
firm value. This meant higher liquidity would indicate that cash and current assets were not used in
companies’ activities. Consequently, it could affect investors’ decision making in having their
investments, (c) DER had a positive effect on firm value. It meant, a higher debt level would give good
information from investors. As long as companies could manage their higher debt for investment, they
would develop and attract the investors.