The Determinant of Stock Price: Evidence on Food and Beverage Companies in Indonesia
Abstract
One aspect that concerns investors in valuing stocks is financial performance. The purpose of this research is to examine the effect of financial performance, firm size, and corporate social responsibility disclosure to the stock price in food and beverage sector companies in Indonesia Stock Exchange. Using a purposive sampling method has done the sample collection method and eleven of eighteen companies, which listed in Indonesia Stock Exchange in the years of 20013-2017, are used as the research samples. The method used in this study was Structural Equation Modeling Partial Least Square (SEM-PLS). The result of the research shows that financial performance, firm size, and corporate social responsibility disclosure affect the stock price. This result implies that the firm should improve the internal factors to increase stock prices.
JEL Classification: G23, G32
Keywords
References
Atkins, A., Niranjan, M., & Gerding, E. (2018). Financial News Predicts Stock Market Volatility Better Than Close Price. The Journal of Finance and Data Science, 4(2), 120–137. https://doi.org/10.1016/j.jfds.2018.02.002
Becchetti, L., Ciciretti, R., Hasan, I., & Kobeissi, N. (2012). Corporate Social Responsibility and Shareholder’s Value. Journal of Business Research, 65(11), 1628–1635.
Caporale, G. M., Hunter, J., & Ali, F. M. (2014). On the Linkages Between Stock Prices and Exchange Rates: Evidence from the Banking Crisis of 2007-2010. International Review of Financial Analysis, 33, 87–103. https://doi.org/10.1016/j.irfa.2013.12.005
Chan, K., Li, F., Lin, J.-C., & Lin, T.-C. (2017). What do Stock Price Levels Tell us About the Firms. Journal of Corporate Finance, 46, 34–50. https://doi.org/10.1016/j.
jcorpfin.2017.06.013
Davidson III, W., Ferris III, K., & Reichenstein III, W. (1993). A Note of the Relationship Between Firm Size and Return in the Electric Utility Industry. Journal of Accounting, Auditing, and Finance, 8(3), 193–202. https://doi.org/10.1177/0148558X9300800301
Djazuli, A. (2017). The Relevance of Leverage, Profitability, Market Performance, and Macroeconomic to Stock Prices. EKOBIS, 22(2), 112–122.
Duy, N. T., & Phuoc, N. P. H. (2016). The Relationship Between Firm Sizes and Stock Returns of Service Sector in Ho Chi Minh City Stock Exchange. Review of European
Studies, 8(4), 210–219. https://doi.org/10.5539/res.v8n4p210
Fiori, G., di Donato, F., & Izzo, M. F. (2015). Corporate Social Responsibility and Stock Prices: a Study on the Italian Market. Corporate Ownership & Control, 12(2), 600–609.
Hill, R. P., Ainscough, T., Shank, T., & Manullang, D. (2007). Corporate Social Responsibility and Socially Responsible Investing: A Global Perspective. Journal of Business Ethics,
(2), 165–174.
Hussainey, K., & Ngoc, L. K. (2009). The Impact of Macroeconomic Indicators on Viatnamese Stock Prices. The Journal of Risk and Finance, 10(4), 321–332. https://doi.
org/10.1108/15265940910980632
Kabajeh, M. A. M., Al Nuaimat, S. M. A., & Dahmash, F. N. (2012). The Relationship Between the ROA, ROE, and ROI Rations with Jordanian Insurance Public Companies Market
Share Prices. International Journal of Humanities and Social Sciences, 2(11), 1011–1020.
Kim, Y., Li, H., & Li, S. (2014). Corporate Social Responsibility and Stock Price Crash Risk. Journal of Banking and Finance, 43, 1–13. https://doi.org/10.1016/j.jbankfin.2014.02.013
Maqbool, S., & Zameer, M. N. (2018). Corporate Social Responsibility and Financial Performance: An Empirical Analysis of Indian Banks. Future Business Journal, 4(1),
–93. https://doi.org/10.1016/j.fbj.2017.12.002
Pranata, D., & Pujiati, D. (2015). The Effect of Liquidity, Profitability, Sales Growth, and Dividend Policy on Stock Prices After the Implementation of IFRS. The Indonesian
Accounting Review, 5(2), 169–178. https://doi.org/10.14414/tiar.v5i2.559
Purnawati, I. G. A. (2016). The Effect of Capital Structure and Profitability on Stock Price:Study of The Manufacturing Sector in Indonesia Stock Exchange. International Journal
of Business, Economics, and Law, 9(1), 10–16.
Raza, S. A., & Karim, M. Z. A. (2016). Do Liquidity and Financial Leverage Constrain the Impact of Firm Size and Dividend Payouts on Share Price in Emerging Economy. Journal of Finance and Economic Research, 1(2), 71–86. https://doi.org/10.20547/jfer.1601201
Roberado, J. C., Rivera-Castro, M. A., & Ugolini, A. (2016). Downside and Upside Risk Spillovers Between Exchange Rates and Stock Prices. Journal of Banking and Finance,
, 76–96. https://doi.org/10.1016/j.jbankfin.2015.10.011
Scholtens, B., & Kang, F. C. (2013). Corporate Social Responsibility and Earnings Management:Evidence from Asian Economies. Corporate Social Responsibility, 20(2), 95–112.
Shafana, M. A. C. N., Rimziya, F., & Jariya, A. M. I. (2013). Relationship Between Stock Returns and Firm Size, and Book-to-Market Equity: Empirical Evidence from Selected
Companies Listed on Milanka Price Index in Colombo Stock Exchange. Journal of Emerging Trends in Economics and Management Sciences, 4(2), 217–225.
Smyth, R., & Narayan, P. K. (2018). What do We Know About Oil Prices and Stock Returns. International Review of Financial Analysis, 57, 148–156. https://doi.org/10.1016/j.
irfa.2018.03.010
Sun, N., Salama, A., Hussainey, K., & Habbash, M. (2010). Corporate Environmental Disclosure, Corporate Governance and Earnings Management. Managerial Auditing Journal, 25(7), 697–700.
Tang, X., & Yao, X. (2018). Do Financial Structures Affect Exchange Rate and Stock Price Interaction? Emerging Markets Review, 34, 64–76. https://doi.org/10.1016/j.
ememar.2017.10.004
Vijayakumar, A. (2010). Effect of Financial Performance on Share Prices in the Indian Corporate Sector: An Empirical Study. Management and Labour Studies, 35(3), 369–
https://doi.org/10.1177/0258042X1003500304
Wei, Y., & Gun, X. (2017). Oil Price Shocks and China’s Stock Market. Energy, 140(1), 185–197. https://doi.org/10.1016/j.energy.2017.07.137
Wen, X., Bouri, E., & Roubaud, D. (2018). Does Oil Product Pricing Reform Increase Returns and Uncertainty in the Chinese Stock Market? The Quarterly Review of
Economics and Finance, 68, 23–30. https://doi.org/10.1016/j.qref.2017.08.003
Wong, K. A. (1989). The Firm Size Effect on Stock Returns in a Developing Stock Market. Economics Letters, 30(1), 61–65. https://doi.org/10.1016/0165-1765(89)90157-2
Yessica, H. M., Ganis, S. E., & Erwin, S. (2017). The Role of Corporate Social Responsibility Disclosure toward Company Stock Price Crash Risk. RJOAS, 8(68), 197–208. https://
doi.org/10.18551/rjoas.2017-08.23
Yuliza, A. (2018). The Effects of Earning per Share and Firm Size to Stock Price LQ45 Company Listed in Indonesian Securities. International Journal of Engineering &
Technology, 7(4), 247–249.
Zheng, X., & Su, D. (2017). Impact of Oil Price Shocks on Chinese Stock Market Liquidity. International Review of Economics and Finance, 50, 136–174. https://doi.org/10.1016/j.iref.2017.03.021
DOI: 10.15408/etk.v18i1.10987
Refbacks
- There are currently no refbacks.
Copyright (c) 2019 ETIKONOMI
