Financing Decision and Dividend Policy to Corporate Value

摘要

This study aimed to examine the effect of capital structure which was proxied by debt equity ratio, and debt asset ratio; and dividend policy which was proxied by dividend payout ratio to the company value which was proxied by price earnings ratio and price book value. The sample of this study was 35 manufacturing companies in the period of 2013-2017 which listed on the Indonesia Stock Exchange with 175 data observations. The analysis used was a quantitative approach with a panel data regression model with an estimated random effect model that had been fulfilled through a hausmant test and a lagrange multiplier test. The results showed that the debt equity ratio had a positive and significant effect on the price earnings ratio, while the debt asset ratio and dividend payout ratio had a negative and significant effect on the price earnings ratio. The debt equity ratio had a positive and significant effect on the price book value, and the debt asset ratio had a negative and significant effect on the price book value, but the dividend payout ratio did not significantly influence the price book value. The conclusions of the study had provided an illustration that the capital structure and dividend policy were considered in the establishment of the firm value.