The market value of equity of manufacturing companies during the COVID-19 pandemic
Open Access
- 1 October 2021
- journal article
- Published by LLC CPC Business Perspectives in Investment Management and Financial Innovations
- Vol. 18 (4), 1-11
- https://doi.org/10.21511/imfi.18(4).2021.01
Abstract
The market value of a public company reflects the expectations of investors. It is influenced by many factors, both internal and external to the company. This study aims to analyze whether intellectual capital moderates the effect of the debt-to-equity ratio and earnings per share on the market value of equity. A set of historical data was collected and analyzed based on a sample of 114 manufacturing companies listed on the Indonesia Stock Exchange from 2017 to 2019. This study uses moderated regression analysis to test proposed hypotheses and a robustness test to examine the sensitivity and consistency of the study results. The findings show that the debt to equity ratio affects the market value of equity, whilst earnings per share does not affect the market value of equity. The analysis also shows that intellectual capital could strengthen the effect of the debt to equity ratio on the market value of equity. In contrast, intellectual capital could not strengthen the effect of earnings per share on the market value of equity. AcknowledgmentsThe study was conducted with the support of the Universitas Riau, Indonesia.Keywords
This publication has 25 references indexed in Scilit:
- Intellectual Capital and Financial Performance in SerbiaKnowledge and Process Management, 2013
- Market Value of the Firm, Market Value of Equity, Return Rate on Capital and the Optimal Capital StructureInternational Journal of Financial Research, 2012
- Impact of Book Value on Market Value of an Equity Share – An Empirical Study in Indian Capital MarketIndian Journal Of Applied Research, 2011
- The impact of intellectual capital on firms' market value and financial performanceJournal of Intellectual Capital, 2011
- Market value, book value and earnings: is bank efficiency a missing link?Managerial Finance, 2009
- An empirical investigation of the relationship between intellectual capital and firms’ market value and financial performanceJournal of Intellectual Capital, 2005
- Fundamental Information AnalysisJournal of Accounting Research, 1993
- A resource‐based view of the firmStrategic Management Journal, 1984
- INFORMATIONAL ASYMMETRIES, FINANCIAL STRUCTURE, AND FINANCIAL INTERMEDIATIONThe Journal of Finance, 1977
- The Determination of Financial Structure: The Incentive-Signalling ApproachThe Bell Journal of Economics, 1977