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The Effect of Liquidity and Profitability on Stock Returns: Evidence from IDX-Listed Automotive and Component Firms Zulfitra; Jonnardi; Adelin, Dessy
Jurnal Ilmiah Manajemen Kesatuan Vol. 14 No. 1 (2026): JIMKES Edisi January 2026
Publisher : LPPM Institut Bisnis dan Informatika Kesatuan

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.37641/jimkes.v14i1.4585

Abstract

The development of the capital market encourages investors to evaluate corporate financial performance as a basis for investment decisions, particularly in the automotive and component sectors listed on the Indonesia Stock Exchange. This study aims to examine the effect of liquidity and profitability on stock returns of automotive and component companies during the 2018–2023 period. A quantitative approach was employed by applying panel data analysis using EViews 12 software. Liquidity was measured using the current ratio, while profitability was assessed through return on assets. The research data were obtained from the companies’ annual financial statements selected through purposive sampling. The findings indicate that liquidity has a positive influence on stock returns, suggesting that a firm’s ability to meet short-term obligations can enhance investor confidence. Furthermore, profitability shows a positive and significant effect on stock returns, implying that higher profit levels provide favorable signals to the market. Simultaneously, liquidity and profitability contribute significantly to the improvement of stock returns. These results strengthen fundamental financial theories and offer practical implications for investors in making informed investment decisions.
The Effect of Current Rasio (Cr) and Profit Margin (Npm) on the Share Price of Milk Industry and Trading Company Tbk Dessy Adelin
Greenation International Journal of Economics and Accounting Vol. 2 No. 2 (2024): (GIJEA) Greenation International Journal of Economics and Accounting (June - Au
Publisher : Greenation Research & Yayasan Global Resarch National

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.38035/gijea.v2i2.184

Abstract

This research is the effect of current ratio and net profit margin on the share price of Milk Industry and trading company Tbk. The method used for this research is a descriptive method with a quantitative approach. The type of data used in this research is quantitative data.  The data source used is secondary data, namely data taken from publications made by the Indonesia Stock Exchange. Namely in the form of the Financial Statements of Milk Industry & Trading Company Tbk. in 2013, 2014, 2015, 2016 and 2017. The highest Current Ratio in 2016 was shown at 484.36% and the highest Net Profit Margin in 2008 was shown at 22.29%. Current Ratio and Net Profit Margin do not have a significant effect on stock prices. For investors, Current Ratio and Net Profit Margin do not have a significant influence in making decisions on whether investors will buy, hold or sell shares. In this case, investors want to get dividends from the company's profits and get capital gains from the positive difference between the purchase price and the selling price of the shares. Current Ratio and Net Profit Margin together or simultaneously do not have a significant effect on stock prices.