The Influence Of Investment Decisions And Financing Decisions On Firm Value With Profitability As Intervening Variables(Empirical Study On Companies Listed In Indonesian Sharia Stock Index)

Abstract

This study aims to analyze the effect of investment decisions and financing decisions on the firm value with profitability as an intervening variable. The variables in this study are current assets to total assets, fixed assets to total assets, debt to assets ratio, debt to equity ratio, return on assets, and free cash flow. The sample in this study were 85 companies listed in the Indonesian Islamic Stock Index (ISSI) in 2012-2016. Data collection techniques in this study are purposive sampling method. The analytical method used is path analysis. The results showed that investment decisions current assets to total assets did not affect profitability while fixed assets to total assets negatively affected profitability. Financing decisions do not affect profitability. Investment decisions have a negative effect on firm value. Financing decisions do not affect the value of the company. Profitability has a positive effect on company value. Profitability does not mediate te effect of investment decisions current assets to total assets on firm value while profitability mediates the effect of investment decisions fixed assets to total assets  on firm value. Profitability does not mediate the effect of financing decisions on firm value.