Determinants of Firm Value in Indonesian Manufacturing Companies Listed on the Stock Exchange in 2020-2022

Abstract

This study examines how funding choices, dividend policies, and investment choices affect firm value in manufacturing companies listed on the Indonesia Stock Exchange between 2020 and 2022. Utilizing a quantitative approach, the research employs purposive sampling to select 27 companies that meet specific criteria as the study's sample. Multiple linear regression is used to analyze the data. The results demonstrate that investment decisions have a positive and substantial impact on the company's worth. However, neither the dividend policy nor the funding decisions have any appreciable effect on the value of the company. Simultaneous testing, however, shows that dividend policy, funding choices, and investment choices all significantly and favorably affect firm value. These findings highlight the importance of investment decisions as a key determinant of firm value in the manufacturing sector. Although funding decisions and dividend policy do not independently affect firm value, their combined effect alongside investment decisions contributes to firm value enhancement.