Profitability as a Mediation Factor: A Test of The Relationship of Capital Structure to Company Value

Abstract

This study investigates how profitability affects the link between capital structure and business value as a mediating factor. 38 companies participated in the study on real estate and property companies listed on the Indonesia Stock Exchange from 2013 to 2017. Path analysis from the multivariate regression was employed for data analysis. The findings of the study demonstrate how important and beneficial the capital structure is to value. Profitability does not, however, act as a mediating factor in the connection between capital structure and business value. Because of the restrictions of the research object and the proxies used for each observed variable, it is impossible to generalize the study's findings.