Return on Equity, Earnings Per Share, and Their Impact on Stock Prices: An Empirical Study in the Mining Sector: (Return On Equity, Earnings Per Share, Dan Dampaknya Pada Harga Saham: Studi Empiris Di Sektor Pertambangan)

Nuryatin Fiqhiyyah (UIN Syekh Wasil Kediri)
Mundhori Mundhori (IAIN Kediri)
Irfan Harmoko (UIN Syekh Wasil Kediri)

Al-Muhasib: Journal of Islamic Accounting and Finance
Vol. 5 No. 2 (2025)

This study aims to analyze the effect of Return on Equity (ROE) and Earnings Per Share (EPS) on the share price of PT Indo Tambangraya Megah Tbk (ITMG) for the period 2018–2023. The background of this study is based on the inconsistency of previous empirical findings regarding the relationship between these two financial ratios and stock prices, especially in the cyclical mining sector. Using a quantitative approach and multiple linear regression analysis, this study utilizes secondary data from monthly financial reports and closing stock prices. The test results show that ROE and EPS have a positive and significant effect, both partially and simultaneously, on stock prices. However, the coefficient of determination (R²) of 0.395 indicates that the two variables only explain 39.5% of the variation in stock prices, while the rest is influenced by external factors such as global commodity prices and macroeconomic conditions. These findings reinforce the relevance of fundamental analysis in mining sector stock investment, while also emphasizing the importance of considering external contextual factors in investment decision-making.