THE INFLUENCE OF CAPITAL STRUCTURE AND PROFITABILITY ON COMPANY VALUE IN PHARMACEUTICAL SUBSECTOR COMPANIES LISTED ON THE INDONESIA STOCK EXCHANGE (IDX) FOR THE PERIOD 2020-2023

Abstract

The purpose of this research is to: (1) determine and analyze the effect of capital structure on company value, (2) determine and analyze the effect of profitability on company value, and (3) determine and analyze the effect of capital structure measured by the debt to equity ratio, and profitability measured by return on assets on company value measured by price book value. The population in this study is the pharmaceutical industry companies listed on the Stock Exchange, totaling 13 companies, with a sample of 6 companies over 4 years of observation. The data collection technique in this study uses documentary techniques. The data analysis technique employs panel data regression. Data processing in this research uses Eviews 12. Based on the research results, it shows that capital structure does not have a significant effect on company value, profitability has a significant effect on company value, and both capital structure and profitability have a significant effect on company value.

Keywords: Capital Structure, Profitability, and Firm Value