THE EFFECT OF FINANCIAL PERFORMANCE ON STOCK RETURN

Hoetanto, Winkly (2019) THE EFFECT OF FINANCIAL PERFORMANCE ON STOCK RETURN. S1 thesis, UAJY.

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Abstract

This research aims to analyze the effect of financial performance on stock return of pharmaceuticals companies listed on Indonesia Stock Exchange (IDX) during the period 2014 - 2018. Financial performance in this research measured by using some financial ratios, namely Debt to Equity Ratio (DER), Return On Equity (ROE), and also Price Earnings Ratio (PER). The data used in this research is secondary data obtained from financial statements of pharmaceuticals companies listed on Indonesian Stock Exchange in 2014 - 2018. Sample selection is done by using purposive sampling method. Then by using the sampling criteria that has been specified, 7 samples are obtained in this research. Multiple linear regression method are used in this research to test the hypothesis. The result shows that DER has a negative effect and significantly influence stock return. While ROE and PER both have a positive effect and are significantly influence stock return. The result of the coefficient of determination (Adjusted R2) obtained a value of 0,962, this indicates that DER, ROE, and PER have effect on stock return on pharmaceuticals companies listed on Indonesia Stock Exchange (IDX) during the period 2014 - 2018 for 96,2% and the remaining 3,8% explained by the other variables outside the model.

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