Company Performance And Stock Returns In Indonesia Telecommunication Companies

ABSTRACT

This study aimed to analyze the company performance on stock return in Telecommunication Companies of Indonesia from 2012 until 2020. The company performance consists of profitability ratio as proxied by return on equity, liquidity ratio as proxied by current ratio, solvency ratio as proxied by debt to equity, activity ratio as proxied by total asset turn over, and market ratio proxied by price book value. Data were collected from the Indonesia Stock Exchange website and each related company's website. This study was conducted by a quantitative study using unbalanced panel data regression analysis. This study analyzed a new balanced panel data of 104 firm-year observations from 12 Telecommunication Companies of Indonesia. The results show that profitability ratio, liquidity ratio, solvency ratio, and activity ratio failed to affect stock returns significantly. Meanwhile, the market ratio has a significant positive effect on stock return. This study can be used as an investment guide for both individual and corporate investors. The study contains the most important fundamental analysis related to the company's financial performance, based on the company's price book value.