Research Paper
Year: 2021 | Month: February | Volume: 8 | Issue: 2 | Pages: 264-269
DOI: https://doi.org/10.52403/ijrr.20210237
Analysis of the Effect of Profitability and Leverage on Firm Value with Dividend Policy as an Intervening Variable in Business Index Companies-27, 2016-2019 Period
Tiffany Tetrin Rosalin Butar-Butar1, Khaira Amalia Fachrudin2, Amlys Syahputra Silalahi2
1Postgraduate Students, Department of Management, Faculty of Economics and Business at Universitas Sumatera Utara, Indonesia
2Postgraduate Lecturer, Department of Management, Faculty of Economics and Business at Universitas Sumatera Utara, Indonesia
Corresponding Author: Tiffany Tetrin Rosalin Butar-Butar
ABSTRACT
The purpose of this study was to analyse the effect of profitability and leverage on firm value with dividend policy as an intervening variable in Business Index Companies-27, 2016-2019 period. This type of research is a quantitative descriptive study. The population in this study is the companies in Business Index Companies-27 on the Indonesia Stock Exchange. The sampling method used was purposive sampling method, in which each company population has sample criteria. This study uses secondary data. The data analysis method in this study used descriptive statistical analysis and structural equation modeling (SEM) with the Smart PLS 3 analysis tool. The results of this study found that profitability has a positive and significant effect directly on firm value on the Business Index Companies-27. Leverage does not directly effect firm value. Dividend policy has a positive and significant effect directly on firm value. Profitability directly effect dividend policy and leverage directly does not have a significant effect on dividend policy. Then, indirectly, profitability through dividend policy has a significant effect on firm value while leverage through dividend policy has no significant effect on firm value for the Business Index Companies-27 for the 2016-2019 period.
Keywords: Profitability, Leverage, Dividend Policy, Firm Value.
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