Open AccessThe Effect of Profitability and Liquidity on Firm Value with Leverage as Moderating Variable in Companies That are Joined in LQ45 and Listed on the Indonesia Stock Exchange for the Period 2007-2019
Author(s) -
Regina Clara Febrinta Br Bukit,
Iskandar Muda,
Erwin Abubakar
Publication year - 2021
Publication title -
international journal of research and review
Language(s) - English
Resource type - Journals
eISSN - 2454-2237
pISSN - 2349-9788
DOI - 10.52403/ijrr.20210748
Subject(s) - stock exchange , profitability index , market liquidity , leverage (statistics) , enterprise value , nonprobability sampling , business , variables , population , economics , monetary economics , econometrics , financial economics , finance , statistics , mathematics , demography , sociology
The research objective was to examine and analyze the effect of profitability and liquidity on firm value in companies corporated in LQ 45 and listed on the Indonesia Stock Exchange and test whether leverage can moderate the relationship between the independent and dependent variables. This research is causal research using secondary data. The population of this study is companies that are members of the LQ45 on the Indonesia Stock Exchange from 2007 to 2019. The method of determining the sample uses purposive sampling so that a sample of 10 companies is multiplied by 13 years of research to obtain 130 observations. The analysis technique used in this study uses multiple linear regression analysis and moderating tests with the R Studio tools. The results of this study simultaneously profitability and liquidity have a significant effect on firm value. The results partially profitability has a significant positive effect on firm value, liquidity has an insignificant negative effect on firm value. Meanwhile, for simultaneous moderating, the results show that leverage can moderate the relationship between profitability and liquidity simultaneously on firm value, and partially leverage cannot moderate the relationship between profitability and firm value. Leverage is not able to moderate the relationship between liquidity and firm value.Keywords: profitability, liquidity, leverage, firm value.