According to Komala and Nugroho (2013), one of the main reasons operate the company is to generate profit that will be beneficial for shareholders. Return on Equity (ROE) is included in the profitability ratio. Furthermore, Debt to Equity Ratio (DER) and Return on Equity (ROE) are considered to have an important role in dividend policy, where this policy can ultimately maximize stock returns.Īccording to Lesakova (2007), profitability ratio is ratio intended to measure the effectiveness of management that is reflected in return for the investment result through the company’s activities or in other words, measuring the company’s overall performance and efficiency in the management of liabilities and capital. Debt to Equity Ratio (DER) and Return on Equity (ROE) are two important indicators that investors generally use in assessing the performance of a company. These financial ratios provide information about the short-term and long-term opportunities on a company’s.
Financial ratio analysis is conducted to determine the strengths and weaknesses of company’s financial performance (Santosa, 2016). The performance appraisal of a company can be done by analyzing the company’s financial ratios. Therefore, investors need an assessment of the company’s financial performance before investing capital in that company.
Stock return is the level of income obtained by subtracting the current closing price from the previous stock closing price divided by the previous year’s closing price (Khadafi et al., 2014). The motivation of investors investing in the capital market is to get a return. In various places, there are houses and shophouses, apartments, shopping centers, office centers, condominiums and housing (Pratiwi, 2018). When other sectors collapsed due to economic crisis, the property business showed an anomaly. Property is arguably the sector that never dies. In the case, if there is no demand for property products, it indicates that the economy is in an underdeveloped condition. The development of property activities has a multiplier effect on the development of other sectors that are directly or indirectly related (Marzuki & Newell, 2019). Every economic activity basically will always require property products as a factor of production.
Activities in the property industry can be used as an indicator of how active economic activity is taking place (Utami, 2017). Research in the property sector is said to be important because the need for boards is one of the basic human needs. This has resulted in doubts and delays in investing in the private sector and eroding national economic resilience (Pratiwi, 2018). There is also a depreciation in the rupiah and an increase in fuel prices, which has caused uncertainty and rising inflation. The decline in several aspects of financial statements experienced by property companies due to the impact of the existing global financial crisis. However, property companies listed on the IDX still make the best contribution to consumers. This is caused by various factors that occur. This resulted in a lot of impacts experienced by the company. At present, the profits earned by property companies listed on the Indonesia Stock Exchange (IDX) are experiencing a decline in aspects of their financial statements. As the economy grows, the property and real estate industries also develop. A company, however, may evaluate the type and level of risk before it is adopted as a necessary condition in business operations (Nugraha et al., 2019). For that, every company must be more leverage and always be more careful in running the company to obtain the profit (Thaib et al., 2020). Return in 18 Indonesia’s property and real estate companies.Įconomic development at this time resulted in increasingly fierce business competition. (DER) and Return on Equity (ROE) have direct and indirect effects on Stock Based on th ese findings, we concluded that Debt to Equity Ratio Of Debt to Equity Ratio (DER ) and and Return on Equity (ROE) on stock returns.
Sobel test revealed Dividend Payout ratio (DPR) can be mediate the relationship Our analysis results found that Debt to Equity Ratio (DER), Return onĮquity (ROE), and Dividend Payout Ratio (DPR) have a positive and significantĪffect on stock returns, both partially nor jointly. We applied multiple linear regression model using SPSS and the Sobel We collect ed annual data for eighteen property and real estateĬompanies in Indonesia from the Indonesia Stock Exchange over the period ofĢ014-2018. Variable on the property and real estate companies in Indonesia. Return on Equity on stock returns with dividend policy as an intervening The aims of this study are to investigate the effect of Debt to Equity Ratio and
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