TA DIGITAL
Analysis of the effect of leverage and liquidity towards stock value and profitability as intervening variable of trading companies listed at Indonesia stock exchange 2010-2014
This research aims to investigate the effect of financial performance variables Debt to Equity Ratio (DER) and Current Ratio (CR) to the Stock Price with Return On Equity (ROE) as the intervening variable. The study is conducted to wholesale and retail companies that are listed in Indonesia Stock Exchange within 2010-2014 periods.
The samples are chosen by using Purposive Sampling Method, where 15 companies in Wholesale and Retail trading sub-sector are selected. There are two independent variables in this research, they are Debt to Equity Ratio (DER) and Current Ratio (CR), one dependent variable which is closing Stock Price as well as one intervening variable, Return on Equity (ROE). Analysis methods used in this research are multiple linear regression, simple linear regression and through path analysis.
The result shows that both Debt to Equity Ratio (DER) and Current Ratio (CR) have simultaneous positive and significant influence towards Return on Equity (ROE). Additionally, Return on Equity (ROE) variable positively and significantly affects the Stock Price. It can also be concluded that Debt to Equity Ratio (DER) and Current Ratio (CR) have an effect towards Stock Price with Return on Equity (ROE) as its intervening variable. It was found that DER has a coefficient of 0,318 to the Stock Price through ROE, whereas CR has indirect effect of 0,2415 towards Stock Price with ROE as intervening variable.
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