Is cash flow growth helping stock performance during the COVID-19 outbreak? Evidence from Indonesia

Meliana, Meliana; Kesuma, Hyacynthia; Enjelina, Desy; Rijanto, Arief; Saraswati, Dewi

doi:10.21511/imfi.19(1).2022.19

Investment Management and Financial Innovations

2022

DOI: 10.21511/imfi.19(1).2022.19

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Is cash flow growth helping stock performance during the COVID-19 outbreak? Evidence from Indonesia

Meliana Meliana¹,

Hyacynthia Kesuma²,

Desy Enjelina³

et al.

Abstract: The COVID-19 pandemic is an unexpected event that causes stock market investors to panic so that their value drops drastically. Operating cash flow and free cash flow are indicators of a company’s financial statements that are used as a reference for investors’ decision making in the stock market. A firm’s cash flows reflect real changes in the firm’s value for money. Cash flow growth can provide information on how well the firm’s performance is in generating incremental cash inflows that can increase firm val… Show more

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Cited by 3 publications

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“…Indonesia: The pandemic and resulting economic downturn led to a decrease in demand for energy and a decline in investment in RE projects [92].…”

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confidence: 99%

An Evaluation of ASEAN Renewable Energy Path to Carbon Neutrality

et al. 2023

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Maintaining our standard of living and keeping the economy running smoothly is heavily reliant on a consistent supply of energy. Renewable energy systems create abundant energy by utilizing resources such as the sun, wind, earth, and plants. The demand for renewable energy is increasing, despite power scarcity, pollution, and climate change posing challenges to long-term development in the Association of Southeast Asian Nations (ASEAN), which has seen significant social and economic growth in recent years. To achieve its 23% renewable energy (RE) target, ASEAN can develop solar photovoltaic (PV) electricity. Members of the ASEAN have established regulations and incentives to encourage individuals and businesses to use renewable energy in the future. This paper explores Southeast Asian countries’ comprehensive fossil-free energy options, the region’s renewable energy potential, current capacity, goals, and energy needs. Through the ASEAN Plan of Action for Energy Cooperation (APAEC) 2016–2025 and the ASEAN Declaration on Renewable Energy, ASEAN is committed to reducing its greenhouse gas emissions and promoting sustainable development aligning with the Paris Agreement’s aim to limit global warming to well below 2 degrees Celsius above pre-industrial levels. Results show that decarbonizing the region’s energy system is possible, but current policies and actions must be altered to reach that target level. Further research is necessary to optimize the ASEAN region’s renewable resource technical potential and commercial viability with available technology.

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“…Indonesia: The pandemic and resulting economic downturn led to a decrease in demand for energy and a decline in investment in RE projects [92].…”

mentioning

confidence: 99%

An Evaluation of ASEAN Renewable Energy Path to Carbon Neutrality

et al. 2023

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Smart beta portfolio investment strategy during the COVID-19 pandemic in Indonesia

Salim

Iradianty

Kristanti

et al. 2022

Investment Management and Financial Innovations

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Covid-19 has an impact on stock investment, especially in Indonesia, marked by the decline in the Jakarta Composite Index (JCI) at the beginning of the Covid-19 pandemic. During the Covid-19 era, there was a lot of negative information about the uncertainty of the market, which made investors irrational about the choice of stocks in the portfolio. So this research will have a hypothesis that the High Volatility stock group will be the best portfolio in Covid-19 conditions. The sample used is the Group of stocks that have the largest market capitalization value in JCI. Stocks with large market caps are chosen because of one of the indicators of blue chip stock. The sample will be divided into three portfolio groups, High Volatility, Moderate Volatility, and Low Volatility. The results obtained that High Volatility became the best portfolio during the Covid-19 period. The results of this study prove that the group of stocks with High Volatility will get positive returns and sharpe performance results are the highest and positive, compared to moderate volatility and low volatility portfolios. This result arises because stocks with High Volatility are subject to large price fluctuations and in this situation, investors can invest in these stocks in a short time frame. The short-term process is carried out regularly so that it can be in accordance with investors' expectations for investments in the portfolio.

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Investment Decision and Firm Value: Moderating Effects of Corporate Social Responsibility and Profitability of Non-Financial Sector Companies on the Indonesia Stock Exchange

Suteja

Gunardi

Alghifari

et al. 2023

JRFM

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This study focused on increasing firm value through CSR- and profitability-moderated investment decisions in emerging markets. A panel data analysis method was used for this study with a total of 215 observations of non-financial sector companies on the Indonesian Stock Exchange from 2018 to 2020. The results of the Chow test and the Hausman test showed that the fixed effect model with GLS was the most feasible. The model showed that there was a negative effect of investment decisions on firm value and the role of CSR and profitability strengthened this effect. Based on the results of the robustness check, the research model remained consistent with the results of previous studies. Investment decisions have a negative effect on firm value, and CSR and profitability moderate this effect, either when using other control variables or when using a different estimation model, which in this case was quantile regression. Our findings provide an understanding of the fact that investment decisions are important financial decisions for companies and that they can be controlled through good fund management and risk management.

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Is cash flow growth helping stock performance during the COVID-19 outbreak? Evidence from Indonesia

Cited by 3 publications

References 47 publications

An Evaluation of ASEAN Renewable Energy Path to Carbon Neutrality

An Evaluation of ASEAN Renewable Energy Path to Carbon Neutrality

Smart beta portfolio investment strategy during the COVID-19 pandemic in Indonesia

Investment Decision and Firm Value: Moderating Effects of Corporate Social Responsibility and Profitability of Non-Financial Sector Companies on the Indonesia Stock Exchange

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