Factors Affecting Value of Companies (Case Study of The Indonesian Pharmaceutical Industry)

Abstract

The pharmaceutical industry in Indonesia has good prospects in the future. With the outbreak of Covid 19, the pharmaceutical industry is increasingly important. Firm value reflects the ability of a company to return investment so as to convince investors to invest in the company. It leads us into question what has an impact on firm value. This study aims to determine and analyze the effect of firm size, solvency, and profitability on company assessment either simultaneously or partially. The population in this study were pharmaceutical companies listed on the Indonesia Stock Exchange for the period 2013 to 2018. The sample in this study was selected using a purposive sampling method which selected 7 companies from 12 companies that would be used as research objects. The data analysis method used is the panel data analysis method or a combination of cross sectional and time series. The research results obtained are simultaneously firm size, solvency, and profitability have an effect on firm value. Meanwhile, partially solvency and profitability have an effect on firm value. However, company size has no effect on firm value.