Intervention of dividend pay out ratios in the relationship of liquidity and debt to equity ratio to the profitability of companies incorporated in the Indonesian Syariah Stock Index (ISSI)

Yuliana, Indah (2019) Intervention of dividend pay out ratios in the relationship of liquidity and debt to equity ratio to the profitability of companies incorporated in the Indonesian Syariah Stock Index (ISSI). Presented at 1st International Conference on Islamic Economics and Business1st International Conference on Islamic Economics and Business (ICONIES), 22 Sep 2018, Universitas Islam Negeri Maulana Malik Ibrahim Malang.

Text 5366.pdf - Published Version Restricted to Repository staff only Download (2MB)

Abstract

Increasing the company's ability to produce profits is a focus that must be achieved so that the company is able to maintain its survival. Investment policies, debt policies and dividend policies taken by the organization will influence other financial decisions and have an impact on the company's ability to make a profit. The research objective was to analyze the effect of partial liquidity and debt to equity ratio on profitability and analyze the moderation of divident payout ratio variables in the effect of liquidity and debt to equity ratio on the ability of companies to generate profits. This research was conducted with a quantitative approach, a method of collecting data using the documentation method. The population of this research is the companies incorporated in the Sharia Stock Index (ISSI) during 2013-2017. The sample in this study amounted to 30 with the sampling technique using purposive sampling. Hypothesis testing is done by Partial Least Square (SEM-PLS). The results showed that liquidity as measured by Current Ratio (CR) did not significantly influence Profitability (ROA). So that changes in liquidity that have no effect on changes that occur profitability, while the debt to equity ratio has a significant negative effect on profitability (ROA). Increasing Debt to Equity Ratio increases the decrease in profitability. The dividend payout ratio is not able to moderate the relationship of liquidity to profitability. This is because the dividend payout ratio (DPR) cannot interact with Liquidity (CR) and is also not significantly related to the Profitability variable (dependent variable). The dividend payout ratio is able to moderate the relationship of debt to equity ratio to profitability. Dividend payout ratio can increase company profitability when the company's debt to equity ratio is low, and vice versa, dividend payout ratio can reduce profitability when the company's debt to equity ratio is high.

Item Type:	Conference (Paper)
Keywords:	Current Ratio; debt to equity ratio; devidend payout ratio; profitability
Divisions:	Faculty of Economics > Department of Management
Depositing User:	Rini Rini Safitri
Date Deposited:	11 Apr 2020 11:11

Downloads

Origin of downloads

Actions (login required)

View Item