The Effect of Liquidity, Leverage And Sales Growth on Financial Distress

Abstract

This study aims to determine liquidity, leverage, sales growth, and financial distress in property and real estate companies, as well as the effect of liquidity, leverage, and sales growth on financial distress in property and real estate companies listed at Indonesia Stock Exchange in 2022-2024, both partially and simultaneously. The population in this study was 93 property and real estate companies listed at Indonesia Stock Exchange in 2022-2024. The sampling technique used in this study was purposive sampling, with a sample of 13 companies. The analytical method used in this study was panel data regression analysis with the Random Effect Model (REM) approach. The results of the data analysis showed: (1) A tendency for liquidity to increase and then stabilize. Leverage fluctuated with a tendency to improve. Sales growth fluctuated and did not show stable growth. Meanwhile, financial distress fluctuated and tended to worsen towards the end of the observation period. (2) The results also showed that liquidity, leverage, and sales growth simultaneously influenced financial distress. (3) Partially, liquidity and leverage had a positive effect, while sales growth had no effect on financial distress.