The Effect of Financial Distress, Stock Split, and Financial Performance on Stock Returns in Companies Listed on the IDX in 2020-2023

Alesya Firnanta Thalia; Dailibas; Achmad Nawawi

doi:10.63922/ijebir.v5i04.3994

Alesya Firnanta Thalia Singaperbangsa University, Karawang
Dailibas Singaperbangsa University, Karawang
Achmad Nawawi Singaperbangsa University, Karawang

DOI: https://doi.org/10.63922/ijebir.v5i04.3994

Keywords: Financial Distress, Financial Performance, Stock Returns, Stock Split

Abstract

Stocks are one of the investment instruments in the capital market. The stock price is the value of a share, reflecting the wealth of the company or issuer issuing the shares. Stock prices are determined by supply and demand in the capital market (secondary market). The more investors buy a stock, the higher the stock price will be, and when investors sell, the price will fall. Several factors influence stock prices, including macroeconomic conditions, sectoral growth, company fundamentals, fair value, and stock price charts. However, stock prices can also fluctuate due to financial distress, stock splits, and financial performance. This study aims to examine the effect of financial distress, stock splits, and financial performance on stock returns. This study used a sample of 26 companies for the 2020-2023 period. The total sample size was 104 annual reports, financial statements, and stock prices. This research used a purposive sampling method. Data analysis in this study used the Statistical Package for the Social Sciences (SPSS) using the SPSS 27 application. The results of the study found a simultaneous effect of financial distress and financial performance on stock returns. Furthermore, the results also showed a partial effect of financial performance on stock returns. Independent variables other than financial performance did not have a partial effect on stock returns

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