The Influence of Financial Ratios on Firm Value

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Sakina Ichsani*, Dean Andrian, Dicky Pirmansyah, Haeroni, Zisko Zuarnel


The purpose of this study is to determine the effect of financial ratios consist of liquidity ratios, profitability ratios, leverage ratios), market ratios and company size to firm value in the agricultural sector listed on the Indonesian stock exchange for the period 2015-2019. The number of research population is 21 companies and the number of samples used in this study is 16 companies. Data processing is carried out using the IBM SPSS Statistics 20 system. Based on data analysis and research results, it can be concluded that it shows that simultaneously liquidity ratio, profitability ratio, leverage ratio, market ratio and company size affect firm value.  Meanwhile the liquidity variable has a positive effect on firm value because it has a sig liquidity value of less than 0.05. But, the profitability, leverage, market, and size variables have no effect on firm value because it has a sig value of more than 0.05. Companies need to pay attention to the liquidity ratio; because it is proven that the liquidity ratio has a significant effect on firm value. For further researchers, it is suggested that they can research with other variables outside of this variable in order to obtain more varied results that can describe what things can affect company value, besides extending the observation period and expanding the scope of research on the effect of financial ratios on value companies in the agricultural sector.

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