EFFECT OF LIQUIDITY RATIO, LEVERAGE RATIO, PROFITABILITY RATIO, GROWTH OPPORTUNITIES, AND FIRM SIZE TO EARNING RESPONSE COEFFICIENT (STUDY IN GO PUBLIC TELEKOMMUNICATION COMPANIES IN INDONESIA STOCK EXCHANGE PERIOD 2011-2017)

Fajar Aulia Rachman, Brady Rikumahu

Abstract

Globalization in economic field has resulted in controlled free competition, which means competition under WTO (World Trade Organization) regulations, including in telecommunications sector. One of the ways that a company can do to fill the capital needs is by offering shares to public (go public). Earnings response coefficient as a way to identifying and describing the different market reactions to earnings information.
The purpose of this study is to determine the development of liquidity ratio, leverage ratio, activity ratio, profitability ratio, growth opportunities, and firm size. In addition, this study also examines the effect of each variable of liquidity ratio, leverage ratio, activity ratio, profitability ratio, growth opportunities, and firm size of the earnings response coefficient either simultaneously or partially. This study use quantitative methods and descriptive verification research. population in this study are telecommunications companies listed on the Indonesia Stock Exchange (IDX) in 2011-2017. The sampling technique use purposive sampling method. Data analysis techniques performed by the data panel regression analysis using a common effect model, and hypotheses were tested using the F test and t test with a significance of 5%.
The results show simultanously variable liquidity ratio, leverage ratio, profitability ratio, growth opportunities and firm size didn’t have significant effect on earning response coefficient. The result of coefficient determination shows that dependent variable can be explained by independent variables of 12,14%. Partially, liquidity ratio, growth opportunities, and firm size have significant effect on earning response coefficient. While variable leverage ratio dan profitability ratio didn’t have significant effect on earning response coefficient.
Keywords: liquidity ratio; leverage ratio; activity ratio; profitability ratio; growth opportunities; firm size; earning response coefficient

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