THE EFFECT OF ALTMAN Z – SCORE FINANCIAL RATIO ON STOCK PRICE (STUDY ON GO PUBLIC PLANTATION SUBSECTOR COMPANIES IN INDONESIA STOCK EXCHANGE)

Authors

  • Muhammad Fachri Radityatama University of Mercubuana, Jakarta, Indonesia
  • Matrodji H. Mustafa University of Mercubuana, Jakarta, Indonesia

DOI:

https://doi.org/10.31933/dijdbm.v1i1.89

Keywords:

Working Capital to Total Assets (WCTA), Retained Earnings to Total Assets (RETA), Earnings Before Interest and Tax (EBITTA), Equity Market Value to Book Value of Total Liabilites (MVEBTL) Stock Price

Abstract

This study aims to examine and analyze the effect of the ratio - financial ratios Altman Z-Score on stock prices (study at the plantation subsector company that went public on the stock exchanges of Indonesia). The research data is annual data from 2014 until 2018. The sampling method used was purposive sampling. Of the population of 16 companies in the plantation subsector, 15 companies met the criteria plantation sub-sector into the sample. The analytical method used in this study is panel data regression. The results showed Working Capital to Total Assets (WCTA), Retained Earnings to Total Assets (RETA), Earnings Before Interest and Tax (EBITTA) and Market Value Equity to Book Value of Total Liabilites (MVEBTL) together - the same (simultaneous) effect significant positive stock price

References

Kerlof, George A. (1970). The Market for 'Lemons': Quality Uncertainty and the Market Mechanism. Quarterly Journal of Economics (The MIT Press) 84 (3): 488-500.
Altman, E. (1968). Financial Ratios, Discriminant Analysis and the Prediction of Corporate Bankcrupty. Journal of Finance. 589-609.
Andry, Y. (2018). Arid Makin Plantation Export Performance In 2018.http://ekonomi.bisnis.com/read/20181111/12/858648/kinerja-ekspor-perkebunan-makin-gersang-pada-2018, (Accessed on July 29, 2019).
E.Fama. (1970). Efficient capital markets: a review of theory and empirical work. Journal of Finance, 383-417.
Fakhrurozie. (2007). "Analysis of Effect of Bankruptcy Bank With Altman Z-Score method Share Price Corporate Banking In Jakarta Stock Exchange".
Handojo. (2001). "Analysis of Effect of Ratio - Financial Ratio Altman On The Stock Market". Diponegoro University of Semarang.
Juanda, Bambang, and Junaidi. (2012). "Econometric Time Series Theory and Applications". Bogor: IPB Press.
Jugiyanto. (2010). Portfolio Theory and Investment Analysis. Four editions. Yogyakarta: BPFE.
Kamaludin. (2011). Financial Management: Basic Concepts and Implementation. Bandung: Mandar CV Maju.
Marceline, AT, Yuliandhari, SW (2014). "Bankruptcy Prediction Method Using Z-Score And Its Effect On Stock Price Transportation Companies Listed in Indonesia Stock Exchange Year 2008-2012". Vol 1 No. 3. ISSN: 2355-9357.
Mario. (2012). "Effects of Financial Distress Ratio Altman Model On The Stock Market In Manufacturing Companies Listed on the Stock Exchange Period 2008-2010". State University of Malang. Poor.
Purwanda, E., Yuniarti, K. (2014). "Testing Impact Ratio Altman, DER, and the Interest Rate on Stock Price Company Mining Sector in Indonesia Stock Exchange". Vol XI, # 2.
Ramadan, AF, Wuryani, E. (2018). "Bankruptcy Prediction Effect On The Stock Company".
Ross, SA (1977). "The Determination of the Financial Structure: The Incentive Signaling Approach", Journal of Economics, Spring, 8, pp 23-40.
Spence, Michael. (1973). Job Market Signaling. The Quartely Journal of Economics, Vol. 87, No. 3. (Aug., 1973), PP. 335-374.
Sukmawati, DMN, et al. (2014). "Effect of Ratio - The ratio of the Altman Z-Score On The Stock Market (Studies in Banking Companies that go public in Indonesia Stock Exchange)". Vol 2 No. 1.

Downloads

Published

2020-01-08

Issue

Vol. 1 No. 1 (2019): Dinasti International Journal of Digital Business Management (December 2019 - January 2020)

Section

Articles

License

Authors who publish their manuscripts in this journal agree to the following conditions:

  1. The copyright on each article belongs to the author(s).
  2. The author acknowledges that the Dinasti International Journal of Digital Business Management (DIJDBM) has the right to be the first to publish with a Creative Commons Attribution 4.0 International license (Attribution 4.0 International (CC BY 4.0).
  3. Authors can submit articles separately, arrange for the non-exclusive distribution of manuscripts that have been published in this journal into other versions (e.g., sent to the author's institutional repository, publication into books, etc.), by acknowledging that the manuscript has been published for the first time in the Dinasti International Journal of Digital Business Management (DIJDBM).