Fundamental Financial Information as a Signal of Company Value

摘要

The information contained in the financial statements is a means to communicate company performance. Good company performance will be responded positively by investors in the capital market, so that the company's stock price will increase. This research examines some fundamental factors in a company by using the information contained in the statements of comprehensive income and financial position (balance sheet) to explaining changes in company value. This research was carried out using a survey method in data collection of companies listed in the business index 27 from 2016 to 2018. Using statistical tests with path analysis, conducted for 17 companies, showed mixed results for every financial information contained in the balance sheet. The results of this research indicate that Cash Equivalent, Cost of Goods Sold, and Gross Profit have an overall/total effect on the value of the company that is greater than the direct effect. Meanwhile, Depreciation Expense and operating profit showed the different result. These two variables actually have a total effect on firm value that is lower than the direct effect.