The Influence of Profitability and Financial Leverage on Dividend Policy: An Evidence from Manufacturing Industrial Companies in Indonesia

Abstract

The purpose of this study is to determine the effect of profitability and financial leverage on dividend policy in manufacturing industrial companies listed on the Indonesia Stock Exchange from 2015-2019. The sample in this study is 18 manufacturing companies selected by purposive sampling method. The company data for sample selection is taken from the Indonesia Stock Exchange official website, which is idx.co.id. The analysis technique used in this study is panel data regression analysis, assisted by software Econometrics Views (E-Views) version 11. The results indicate that profitability does not have a significant effect on dividend policy, while financial leverage has a significant and positive effect on dividend policy.