Open AccessProfitability Ratio Analysis and its Effect’s to Firm Value in the Food and Beverage Industry in Indonesian Stock Exchange
Author(s) -
Sitti Murniati
Publication year - 2017
Publication title -
information management and business review
Language(s) - English
Resource type - Journals
ISSN - 2220-3796
DOI - 10.22610/imbr.v9i4.1894
Subject(s) - profitability index , profit margin , stock exchange , operating margin , earnings before interest and taxes , business , beverage industry , economics , profit (economics) , value (mathematics) , marketing , microeconomics , return on assets , finance , machine learning , computer science
This study aims to analysis the profitability ratio consisting of net profit margin, basic earning power and contribution margin and its effect on firm value in Food and Beverage industry. The data in this study, obtained from the capital market information center with the object of research in Food and Beverage industry listed on the Indonesian Stock Exchange. This study uses secondary data sourced from the financial statements in Food and Beverage industry, published by the Indonesian Stock Exchange in 2012 until 2015. The data analysis method used is multiple regression analysis. After analysis of all data, the result of research is as follows: 1) net profit margin has a positive and significant effect to price book value which means that management experience success in operational matter and will result in increasing investor trust to invest in Food and Beverage industry, 2 ) basic earning power has a positive and insignificant effect to price book value which means that the working capital in the issuer is only the operating capital or operating assets, as well as the profit that is accounted for only from the operating income of the company is net operating income, and 3) contribution margin has a negative and significant effect to price book value which means that the issuer has not been able to generate profits from the sales of its product caused by the selling price of down so that the contribution margin amount cannot be used to cover all fixed costs so that there is loss in the period.