The Influence of Profitability, Capital Structure, and Investment Decisions on Company Value (A Case Study of LQ45 Companies Listed on the Indonesia Stock Exchange for the 2021-2024 Period)

Graciella Chrysta Avena Christian; Ika Listyawati

doi:10.63922/ijebir.v5i05.5647

Graciella Chrysta Avena Christian AKI University Semarang
Ika Listyawati AKI University Semarang

DOI: https://doi.org/10.63922/ijebir.v5i05.5647

Keywords: Financial Performance, Village Budget, Financial Ratios

Abstract

Firm value is an important indicator reflecting investor perceptions of a company's performance and prospects. However, research findings on the influence of profitability, capital structure, and investment decisions on firm value remain inconsistent. This study aims to analyze the influence of profitability, capital structure, and investment decisions on firm value in LQ45 companies listed on the Indonesia Stock Exchange for the 2021-2024 period. The study employed a quantitative approach with descriptive methods. The study population comprised all LQ45 companies, while the sample was determined using a purposive sampling technique, resulting in 33 companies with 132 observations. The research data consisted of secondary data obtained through documentation of the companies' annual financial reports. Data analysis was performed using SPSS version 27 through descriptive statistical analysis, classical assumption tests, multiple linear regression, t-tests, F-tests, and coefficients of determination. The results showed that profitability had a positive and significant effect on firm value, while capital structure and investment decisions had no significant effect. Simultaneously, all three variables influenced firm value. This study concluded that profitability was the most influential factor in increasing firm value compared to capital structure and investment decisions in LQ45 companies for the 2021-2024 period.

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