The Effect of Price Earning Ratio, Firm Size, and Corporate Social Responsibility on Firm Value (Empirical Study on Pharmaceutical Sub-Sector Companies Listed on The Indonesia Stock Exchange 2016 – 2020 Period)

Abstract

Investors can use the firm value to see the company's performance in the past and predict the company's performance in the future. There are many factors that can affect the firm value in the future, including the company's ability to generate profits, the scale of the company, and the company's responsibility to stakeholders. However, there is a difference between expectations and the phenomena that occur in the field regarding these factors. The purpose of this research was to determine the effect of Price Earning Ratio, Firm Size, and Corporate Social Responsibility either partially or simultaneously on the value of pharmaceutical companies listed on the Indonesia Stock Exchange for the 2016-2020 period. The type of data used in this research is quantitative data, namely the annual financial statements of pharmaceutical sub-sector companies listed on the Indonesia Stock Exchange. The sample selection in this research was based on purposive sampling method, so that the sample used in this research amounted to 45 companies for 5 years. The data analysis technique used is multiple linear regression analysis. The results showed that partially Price Earning Ratio had a significant positive effect on firm value, while Firm Size and Corporate Social Responsibility had no significant effect on firm value. Simultaneously, Price Earning Ratio, Firm Size, and Corporate Social Responsibility have a significant effect on the value of pharmaceutical companies listed on the Indonesia Stock Exchange by 19.4%.

Kinerja Keuangan dan Nilai Perusahaan Sektor Farmasi

“…Dilihat dari sudut pandang pemilik modal, kinerja keuangan suatu perusahaan dapat menjadi salah satu bahan pertimbangan mereka dalam pengambilan keputusan investasi saham [8]. Oleh karena itu perusahaan juga perlu senantiasa menjaga dan meningkatkan kinerja keuangannya sehingga pemilik modal tetap menjadikan perusahaan sebagai alternatif dalam melakukan investasi dan mereka tetap mempunyai minat terhadap saham perusahaan [9]. Dalam hal ini gambaran kinerja keuangan dapat diperoleh melalui laporan keuangan yang dibuat oleh perusahaan secara periodik.…”

Faktor-Faktor yang Mempengaruhi Nilai Perusahaan Manufaktur di Indonesia

“…Bagi para pemegang saham, nilai perusahaan adalah hal yang penting. Pentingnya nilai perusahaan bagi pemegang saham termanifestasi karena nilai tersebut dapat memberikan wawasan tentang kinerja perusahaan pada periode sebelumnya dan memberikan indikasi terhadap kinerja di masa mendatang, sehingga nilai perusahaan dipilih oleh para pemegang saham sebagai panduan dalam membuat keputusan investasi (Marc et al, 2022). Evaluasi kinerja perusahaan sering kali ditinjau dari rasio profitabilitas, yang mencerminkan sejauh mana bisnis dapat menghasilkan keuntungan dan memanfaatkan asetnya secara efektif (Brigham & Houston, 2019).…”

Determination of Earnings Quality and Firm Value: New Evidence from Indonesian Non-financial Companies

“…Price earnings ratio (PER) is a market value ratio that evaluates a company's prospects (Marc et al, 2022) and determines future stock returns (Setiyaning & Mispiyanti, 2022). The market, especially investors, are willing to pay a high price for a company's stock because a high PER reflects the high growth prospects (Marc et al, 2022), the excellent performance of the company (Ratnasari, 2022), and the healthy financial condition (Setiyaning & Mispiyanti, 2022). High stock demand indicates that the stock price has also soared and has the potential to reap profits from the difference in stock prices, so the quality of profits increases.…”

“…The increase and decrease in earnings quality can be influenced by the presence of several factors that act as the basis for investment considerations for stakeholders. For example, firm size (Erawati & Rahmawati, 2022;Saleh et al, 2020;Puteri & Trisnaningsih, 2022), firm growth (Nakashima, 2019;Anam & Afrohah, 2020;Saleh et al, 2020), working capital ratio (Irawan & Ardianti, 2021;Saleh et al, 2020;Charisma & Suryandari, 2021), cash to current assets (Saleh et al, 2020), current debt to total assets (Lestari, 2020;Saleh et al, 2020), earnings per share (Andriani et al, 2021;Puteri & Trisnaningsih, 2022;Saleh et al, 2020), firm age (Nakashima, 2019;Erawati & Hasanah, 2022), listing age (Nakashima, 2019;Erawati & Hasanah, 2022), price earnings ratio (Marc et al, 2022;Hulasoh & Mulyati, 2022), market capitalization (Lathifatussulalah & Dalimunthe, 2022;Rahmanissa & Isynuwardhana, 2022), corporate social responsibility award (Siswantaya, 2022), managerial capability (Lukita, 2022;Romadhon & Kusuma, 2020), and earnings management (Purwaningsih et al, 2020;Saleh et al, 2020).…”