PENGARUH FREE CASH FLOW, PROFITABILTAS, KEBIJAKAN HUTANG TERHADAP KEBIJAKAN DIVIDEN

Abstract

This research aimed to find out the effect of free cash flow, profitability, and debt policy on dividend policy. While,
profitability was measured by Return On Asset. Meanwhile, debt policy was measured by Debt to Equity Ratio.
The research was quantitative. Moreover, the population was 10 Property and Real Estate companies which were
listed on Indonesia Stock Exchange (IDX) during 2014-2018. Furthermore, the data collection technique used
purposive sampling, in which the sample was based on criteria given. In line with, there were 50 samples.
Additionally, the data analysis technique used multiple linear regression. The research result concluded free cash
flow had positive and significant effect on dividend policy. It meant, the higher free cash flow, the greater supply
of cash rest in increasing its dividend payment. Likewise, profitability had positive and significant effect on
dividend policy. In other word, when companies produce maximum profit, it will increase dividend share. On the
other hand, debt policy had positive but insignificant effect on dividend policy. It meant, as companies have their
higher ability to pay all their liabilities, their ability of sharing the dividend was lower.
Keywords: free cash flow, profitability, debt policy, dividend policy