SOSIOHUMANIORA: Jurnal Ilmiah Ilmu Sosial dan Humaniora
Vol 10 No 1 (2024): Februari 2024

Return on assets, return on equity, earnings per share, dividend yield, and book-to-market ratio’s effects on stock return

Annisa Aulia Rahma Atmariani (Universitas Airlangga)
Dian Agustia (Universitas Airlangga)



Article Info

Publish Date
22 Jan 2024

Abstract

This research intends to investigate the ability of Return on assets (ROA), return on equity (ROE), earnings per share (EPS), dividend yield (DY), and book-to-market ratio (BMR) on stock returns. Stock investment is one strategy for investors to channel their finances while boosting wealth due to the high return on equities earned. In this study, company information is represented by financial ratios, which play a significant role in guiding investors in identifying which companies have the potential to give the highest number of returns. With 164 total observations, this research used 56 companies that were part of the LQ45 index on the Indonesian Stock Exchange (IDX) in the 2019–2022 timeframe as a sample study with the aim to examine the effects of ROA, ROE, EPS, dividend yield, and book-to-market ratio on stock return. Using STATA 14.0 software, double linear regression analysis is used in the hypothesis test. The results of this research, as proven by the regression analysis, are as follows: (1) the book-to-market ratio negatively affects stock return; and (2) ROA, ROE, EPS, and dividend yield have no bearing on stock return. This study emphasizes the value of diversifying investment strategies and avoiding a narrow range of financial ratios when choosing which stocks to buy. Investors should evaluate general business conditions and take a wider range of issues into account.

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Journal Info

Abbrev

sosia

Publisher

Subject

Arts Humanities Education

Description

SOSIOHUMANIORA berisi artikel tentang gagasan konsep, teori, kajian dan hasil penelitian dari berbagai bidang yang berkaitan dengan sosial, budaya dan pendidikan dari para peneliti, praktisi serta hasil karya tugas akhir mahasiswa yang memenuhi ...