INFLUENCE PROFITABILITY, LEVERAGE AND COMPANY SIZE ON FIRM VALUE OF CONSUMPTION SECTOR COMPANY

Abstract

This study aims to examine the impact of profitability, leverage, and company size on firm value of consumption sector firms from 2020 to 2023. The research will utilize panel data regression analysis through the EViews application. Profitability will be measured using Return on Equity (ROE), Leverage measured using Debt to Equity Ratio (DER), company size will be represented by the natural logarithm of total assets, and firm value will be measured using the Price to Earning Ratio (PER). The findings from the Chow test indicate a Cross Section Chi-square value of 0.000, while the Hausman test shows a random Cross Section probability value of 0.004. Consequently, the fixed effect model will be employed for the panel data regression analysis. Results from this model reveal that profitability does negative significantly impact firm value, while leverage and Company size have no impact to firm value.