PENGARUH FREE CASH FLOW DAN PROFITABILITAS TERHADAP KEBIJAKAN DIVIDEN (Studi Pada Perusahaan Manufaktur)

Abstract

This research aimed to examine the effect of free cash flow and profitability on dividend policy of manufacturing
companies which were listed on Indonesia Stock Exchange. While, the sampling collection technique in research
used purposive sampling. Moreover, the population was 69 manufacturing companies which were listed on
Indonesia Stock Exchange during the 2015-2017 periods. Furthermore, the data analysis technique used
multiple linear regression and the hypothesis test has been done by performing SPSS 24 version. In addition, the
research result concluded as follows: a) Free Cash Flow did not affect on dividend policy. This happened as the
dividend payment was not based on the use of free cash flow, but rather on the aim of maintaining the shares
price and firm value; b) profitability had positive effect on dividend policy. In meant, the higher profitability, the
higher dividend policy would be. On the other way around, the lower profitability, the lower dividend policy
would be.
Keywords: Free Cash Flow, Profitability, and Dividend Policy.