Analysis of the Relationship between Financial Performance and Stock Prices in Food and Beverage Sub-Sector Companies Listed on the IDX

Abstract

A company must face competition in carrying out its business activities. Companies need to make improvements to maintain the sustainability of their business. To fulfill this, capital is one that plays an important role. One way to get capital for companies is to enter the capital market. The capital market is a market for sharing long-term financial instruments that can be traded, either in the form of shares or other instruments. When entering the capital market, companies have an obligation to report their financial performance. The purpose of this study was to analyze the effect of financial performance as measured by the Current ratio, Debt to Equity Ratio, Net Profit Margin and Earning per Share on the Stock Price. This research was conducted in food and beverage sub-sector companies listed on the IDX. Purposive sampling method was used in determining the sample and obtained 18 companies that meet the criteria to be sampled. The analysis technique used is multiple linear regression analysis technique. The results of this study indicate that the variables Current ratio, Debt to Equity Ratio, Net Profit Margin do not have a positive and significant effect on stock prices. Earnings per share only has a positive and significant effect on stock prices and is the most dominant variable in influencing stock prices in food and beverage sub-sector companies listed on the IDX in 2017-2021.