Impacts of Free Cash Flow and Agency Cost on Firm Performance

Muadz Rizki Muzakki, Imo Gandakusuma
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引用次数: 2

Abstract

This study aims to examine the effect of free cash flow and agency cost to firm performance. The purpose of this study to provide empirically evidence about the effect of free cash flow and agency cost to firm performance. This study also examines the free cash flow hypothesis developed by Jensen (1986). Recent study about this topic resulting mixed/various result. Free cash flow in this study measured by free cash flow t-1, agency cost proxied by operating expenses ratio. Firm performance divided into three, operational performance measured by ROA, firm value measured by tobin's q ratio, and share return measured by holding period return. This study will conduct on manufacturing companies listed on Indonesian Stock Exchange period of 2017-2021. Sample were selected by purposive random sampling method and finally obtained 396 samples that fulfill the criteria. Data were analyzed using multiple regression analysis. The result show that free cash flow has insignificant positive effect on firm operational performance, firm value and share return. Agency cost has significant negative effect on firm operational performance, firm value and share return. This study provides empirical evidence of the effect agency cost on firm performance and provides contribution to the literature on free cash flow hypothesis topics
自由现金流和代理成本对企业绩效的影响
本研究旨在探讨自由现金流和代理成本对企业绩效的影响。本研究的目的是为自由现金流和代理成本对企业绩效的影响提供实证证据。本研究还检验了Jensen(1986)提出的自由现金流假说。最近关于这个话题的研究得出了不同的结果。本研究中的自由现金流以自由现金流t-1衡量,代理成本以营业费用比率代替。公司绩效分为三个部分,以ROA衡量经营绩效,以托宾q比率衡量公司价值,以持有期回报衡量股票回报。本研究将对2017-2021年期间在印尼证券交易所上市的制造业公司进行研究。采用有目的随机抽样法进行抽样,最终获得符合标准的样本396份。数据采用多元回归分析。结果表明,自由现金流对企业经营绩效、企业价值和股票收益的正向影响不显著。代理成本对企业经营绩效、企业价值和股票收益有显著的负向影响。本研究提供了代理成本对企业绩效影响的实证证据,并对自由现金流假说的相关文献有所贡献
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