The Effect of Profitability and Leverage on Firm Value (A Study of State-Owned Banks Listed on the Indonesia Stock Exchange for the 2021-2024 Period)
DOI:
https://doi.org/10.61492/xmtnjq94Keywords:
Return On Assets, Debt To Equity Ratio, Price To Book Value.Abstract
This study aims to examine the effect of profitability measured by Return on Assets (ROA) and leverage measured by Debt to Equity Ratio (DER) on firm value proxied by Price to Book Value (PBV) in State-Owned Banks listed on the Indonesia Stock Exchange during the 2021–2024 period. This study employed a quantitative approach with an associative method. Secondary data were obtained from the quarterly financial statements of PT Bank Rakyat Indonesia (Persero) Tbk, PT Bank Mandiri (Persero) Tbk, PT Bank Negara Indonesia (Persero) Tbk, and PT Bank Tabungan Negara (Persero) Tbk. The sampling technique used purposive sampling and resulted in 51 observations after outlier removal. The data were analyzed using multiple linear regression with SPSS version 26. The results indicate that profitability measured by Return on Assets (ROA) does not have a significant effect on firm value, while leverage measured by Debt to Equity Ratio (DER) has a significant effect on firm value. Simultaneously, profitability and leverage significantly affect firm value.
Keywords: Return On Assets, Debt To Equity Ratio, Price To Book Value.
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Copyright (c) 2026 Icha Trisilawati, Tina Kartini, Ade Sudarma (Author)
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