Indonesian Journal of Law and Economics Review
Vol 19 No 2 (2024): May
Finance Management

Price to Book Value Drives Stock Prices in Indonesia, While DER and PER Falter
Price to Book Value Mendorong Harga Saham di Indonesia, Sementara DER dan PER Turun


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  • Siska Widiyawati ,
  • Sarwendah Biduri*
Siska Widiyawati
Universitas Muhammadiyah Sidoarjo, Indonesia
*

(*) Corresponding Author
Picture in here are illustration from public domain image or provided by the author, as part of their works
DOI: https://doi.org/10.21070/ijler.v19i2.1068
Published May 28, 2024
Keywords
  • Debt to Equity Ratio,
  • Price to Book Value,
  • Price Earning Ratio,
  • Stock Prices,
  • Indonesia Stock Exchange
How to Cite
Widiyawati , S., & Biduri, S. (2024). Price to Book Value Drives Stock Prices in Indonesia, While DER and PER Falter. Indonesian Journal of Law and Economics Review, 19(2), 10.21070/ijler.v19i2.1068. https://doi.org/10.21070/ijler.v19i2.1068

Copyright (c) 2024 Siska Widiyawati , Sarwendah Biduri

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

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Abstract

This study examines the impact of the Debt to Equity Ratio (DER), Price to Book Value (PBV), and Price Earning Ratio (PER) on stock prices of food and beverage companies listed on the Indonesia Stock Exchange (IDX) from 2016 to 2018. Using secondary data from financial reports and statistical analysis via SPSS 23, the research found that DER does not significantly affect stock prices, PBV positively influences stock prices, and PER has no significant impact. These findings suggest that investors prioritize market confidence and financial prospects (as indicated by PBV) over debt levels and earnings ratios when making investment decisions in this sector.

Highlights:

1. DER Impact: Debt to Equity Ratio does not affect stock prices significantly.
2. PBV Significance: Price to Book Value positively influences stock prices.
3. PER Irrelevance: Price Earning Ratio does not impact stock prices significantly.

Keywords: Debt to Equity Ratio, Price to Book Value, Price Earning Ratio, Stock Prices, Indonesia Stock Exchange

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