Open AccessProfitability and Company Value: Empirical Study of Manufacture Companies in Indonesia Period 2009 - 2014
Author(s) -
Siti Lestari,
Mursalim Armayah
Publication year - 2016
Publication title -
information management and business review
Language(s) - English
Resource type - Journals
ISSN - 2220-3796
DOI - 10.22610/imbr.v8i3.1326
Subject(s) - profitability index , profit margin , return on equity , value (mathematics) , return on assets , business , empirical research , equity (law) , profit (economics) , enterprise value , economic value added , economics , equity value , econometrics , finance , microeconomics , statistics , mathematics , debt , debt levels and flows , external debt , political science , law
Maximizing the value of the company is one of the financial issues are interesting to study. Profitability is one of the factors that influence value of enterprise be in accordance with asset and equity owned. The purpose of this research is to describe the correlation between profitability and company value. Based on the problem and purpose research, the research is designed as quantitative research. Secondary data used as the basis for the analysis was obtained from ICMD with observation period of 5 years to 10 companies. Data analyzed by using linear regression multiple analyses. Empirical results show that profitability variability explains change of company value. Return on Investment and Return on Equity has positive and significant effect on company value, but Net Profit Margin negatively and significantly affects company value.