Return on Asset and Firm Size to Value of Firm: Study on Banking Financial Industry Listed on Indonesian Stock Exchange

Tonny Serfius Maringka; Sweetly Mumu; Josua S. Pangau

doi:10.63922/ijebir.v5i05.6501

Tonny Serfius Maringka STIE Eben Haezar Manado, Indonesia
Sweetly Mumu STIE Eben Haezar Manado, Indonesia
Josua S. Pangau STIE Eben Haezar Manado, Indonesia

DOI: https://doi.org/10.63922/ijebir.v5i05.6501

Keywords: ROA, Firm Size, Firm Value

Abstract

This study aims to analyze the influence of Return on Assets and firm size on firm value within the banking sector listed on the Indonesia Stock Exchange (IDX) during the 2019–2023 period. Firm value in this study is proxied by the Price-to-Book Value (PBV) ratio. The independent variables employed are Return on asset (ROA), serving as an indicator of profitability, and firm size, measured using the natural logarithm of total assets. This study utilizes a quantitative method employing multiple linear regression analysis. The data used is secondary data derived from the banks' annual financial reports, obtained from the official IDX website and individual company publications. The sample was selected using a purposive sampling method to identify banks that met the established criteria throughout the observation period. The results indicate that, when analyzed individually, Return on Asset (ROA) does not have a significant effect on firm value. Conversely, firm size has a positive and significant effect on firm value, implying that larger firm size leads to higher investor appreciation for the company. When analyzed simultaneously, both Return on Asset (ROA) and firm size have a significant effect on firm value. Thus, it can be concluded that Return on Asset (ROA) has a positive but insignificant effect, whereas firm size has a positive and significant effect.

References

Asraruddin, Zulkifli, Alvina Zhang, and Fitria Sari Ayu. 2023. “Pengaruh Firm Size Dan Leverage Terhadap Financial Performance Pada Perusahaan Indonesia Sektor Perbankan.” Jurnal Ekonomi Bisnis, Manajemen dan Akuntansi (JEBMA) 3(3): 606–11. doi:10.47709/jebma.v3i3.2863.
Atrianingsih, Shela, and M. Hendri Yan Nyale. 2022. “Pengaruh Debt To Equity Ratio (DER) Dan Return on Asset (ROA) Terhadap Nilai Perusahaan Dengan Sales Growth Sebagai Variabel Moderasi.” JIIP - Jurnal Ilmiah Ilmu Pendidikan 5(7): 2700–2709. doi:10.54371/jiip.v5i7.746.
Brigham, Eugene F, and Joel F Houston. 2017. “Fundamentals of Financial Management , Concise 9th Edition.” (9781285065137).
Fajriah, Alifatul Laili, Ahmad Idris, and Umi Nadhiroh. 2022. “Pengaruh Pertumbuhan Penjualan, Pertumbuhan Perusahaan, Dan Ukuran Perusahaan Terhadap Nilai Perusahaan.” Jurnal Ilmiah Manajemen dan Bisnis 7(1): 1–12. doi:10.38043/jimb.v7i1.3218.
Hariyani, Diyah santi. 2021. “Manajemen Keuangan 1 Edisi Revisi, UNIPMA PERS, Madiun.” : 0–118.
Herlina, Herlina, Fera Damayanti, and Syarbini Ikhsan. 2024. “Pengaruh Capital Adequacy Ratio (CAR), Net Interest Margin (NIM), Beban Operasional Dan Pendapatan Operasional (BOPO), Loan to Deposit Ratio (LDR) Terhadap Non Performing Loan (NPL) Pada Bank Pembangunan Daerah Di Indonesia Periode 2019 – 2023.” Jesya 7(2): 1511–23. doi:10.36778/jesya.v7i2.1623.
Jaya, Asri, Sony Kuswandi, Cici Widya Prastyandari, Imam Baidlowi, Mardiana, Yudhistira Ardana, Aris Sunandes, et al. 2018. 7 Modul Kuliah Manajemen Keuangan.
Kusjono, Gatot, and Fitri Aryanti. 2021. “Pengaruh Return On Asset Dan Earning Per Share Terhadap Harga Saham Pada Pt Bank Central Asia Tbk Periode 2010-2019.” Jurnal Disrupsi Bisnis 4(6): 541. doi:10.32493/drb.v4i6.15252.
Kusumastuti, Novietha Indra Sallama; Febriany. 2018. “Dasar-Dasar Manajemen Keuangan Buku 1, Terjemahan.” : 2–4. https://onesearch.id/Record/IOS2750.10.917/Preview.
La Ode Sumail Ikhwan, Syamsul Ridjal. 2021. “Kinerja Keuangan Dan Nilai Perusahaan: Peran Ukuran Perusahaan Perbankan Konvensional Di BEI.” Jurnal Ekonomi. doi:10.24912/je.v26i2.753.
Rahima, Adevia Yulia, and Dul Muid. 2022. “The Effect Of Financial Performance And Firm Size On Firm Value (Case Study of Banking Companies Listed on the Indonesia Stock Exchange in 2018-2020).” Tax Accounting Applied Journal. doi:10.14710/taaij.2023.17990.
Sari, Maheni Ika, Universitas Muhammadiyah Jember, Achmad Hasan Hafidzi, and Universitas Muhammadiyah Jember. 2021. Dasar-Dasar MANAJEMEN KEUANGAN.
Syahrani, Kadek Meilyana, Luh Komang Merawati, and Daniel Raditya Tandio. 2023. “Pengaruh Leverage, Pertumbuhan Perusahaan, Ukuran Perusahaan, Risk Profile Dan Profitabilitas Terhadap Nilai Perusahaan.” Jurnal Inovasi Akuntansi (JIA) 1(1): 32–44. doi:10.36733/jia.v1i1.6884.
Widyaningsih, Dewi, Heni Susilowati, and Myra Andriana. 2022. “Pengaruh Profitabilitas, Leverage, Firm Size Terhadap Nilai Perusahaan Dengan Pengungkapan Csr Dan Gcg Sebagai Variabel Moderating.” Among Makarti 15(3): 289–303. doi:10.52353/ama.v15i3.303.