Jurnal Ekonomi dan Bisnis.
Volume 26 No.
2 Oktober 2023, 431 - 448 Journal homepage: w.
edu/jeb ISSN 1979-6471 E-ISSN 2528-0147 Financial ratios and institutional ownership impact on healthcare firmAos value: A moderation role of leverage Pardomuan Sihombinga*.
Ricky Albert Husnib.
Elia Zakchonac Faculty of Economics and Business.
Mercu Buana University.
Jakarta.
Indonesia.
sihombing@mercubuana.
Faculty of Economics and Business.
Mercu Buana University.
Jakarta.
Indonesia.
r1cky_ah@yahoo.
PT Daksayana Manajemen.
Jakarta.
Indonesia.
eliazakchonahasibuan@yahoo.
ARTICLE INFO
ABSTRAK
Article History:
Received 01-31-2023 Revised 10-15-2023 Accepted 11-13-2023 Pandemi telah menyebabkan kontraksi ekonomi global.
Di tengah perlambatan ekonomi, ada satu sektor yang masih mampu tumbuh, yaitu sektor kesehatan.
Hal ini ditunjukkan dengan pertumbuhan PDB sektor kesehatan selama pandemi.
Namun, data PBV pada perusahaan tersebut tidak menunjukkan hasil yang memuaskan.
Penelitian ini dilakukan untuk menilai faktor-faktor yang dapat meningkatkan nilai perusahaan perusahaan kesehatan, seperti profitabilitas, modal kerja, aset berwujud, dan kepemilikan institusional yang dimoderasi oleh leverage pada nilai perusahaan.
Penelitian ini akan menggunakan teknik analisis data panel, laporan keuangan triwulanan tahun 2020-2021 terhadap sembilan perusahaan subsektor jasa dan perlengkapan kesehatan dari sektor kesehatan yang terdaftar di tahun 2022.
Hasil penelitian ini menunjukkan bahwa aset berwujud memberikan dampak negatif dan leverage memberikan dampak positif terhadap nilai perusahaan, sedangkan faktor lainnya tidak mempengaruhi nilai Leverage hanya dapat memoderasi aset berwujud untuk melemahkan efek negatif dari aset berwujud, sedangkan faktor lain tidak dapat dimoderasi oleh leverage.
Hasil ini menunjukkan bahwa untuk memaksimalkan nilai perusahaan, leverage harus dioptimalkan untuk mengurangi efek negatif dari investasi pada aset berwujud.
Kata Kunci:
Rasio keuangan, harga terhadap nilai buku, profitabilitas, modal kerja, aset berwujud, leverage, kepemilikan institusional Keywords:
Financial ratios, price to book value, profitability, working capital, tangible asset, leverage, institutional ABSTRACT The pandemic has caused a contraction in the global economy.
Amidst the slowing of the economy, a sector still grows so-called This is shown by the growth in the healthcare sectorAos GDP during the pandemic, but the PBV data on these companies didnAot show a satisfactory result.
This study assesses factors that might increase the firmAos value of healthcare companies, such as profitability, working capital, tangible assets, and institutional ownership moderated by leverage on the firmAos value.
This *Corresponding Author Financial ratios and institutional ownership impact (Sihombing.
Husni.
Zakchon.
research uses a panel data analysis technique with moderated regression analysis (MRA) in E-views 12, quarterly financial statements from 2020-2021 of nine companies in the subsector of health services and equipment from the healthcare sector.
The empirical results show that tangible assets have a negative impact, and leverage positively impacts a firmAos value, while the other factors do not affect a firmAos value.
Leverage can only moderate tangible assets to weaken the negative effect of tangible assets, while other factors canAot be moderated by leverage.
This result shows that leverage must be optimised to maximize the firmAos value to reduce the negative effects of an investment in tangible INTRODUCTION According to Presidential Decree No.
11 of 2020.
Indonesia began to experience the effects of the COVID-19 pandemic around the end of March 2020.
The pandemic has harmed the economy of Indonesia and fuelled escalating corporate It has caused stagnation and even failures in many commercial areas, yet some are still growing.
Despite the precarious economic conditions brought on by this epidemic, the health business is nevertheless growing, as indicated by the increase in the Gross Domestic Product (GDP) of the health sector, which was 8.
69 % in 2019, 56% in 2020, and 10.
61% in 2021 (Central Bureau of Statistics Indonesia, 2.
The value of firms in the healthcare sector should increase due to this robust growth in health sector GDP (Jagric et al.
, 2022.
Sartika et al.
, 2.
However, the above sectoral growth data does not reflect the market capitalization data for the health services business.
People's apprehension about hospital visits during the epidemic may explain this fact.
In light of the disparities mentioned in the health sector, it is important to comprehend how to enhance corporate value as a key metric of exceptional organizational performance alongside robust profitability and the welfare of firm owners and shareholders (Hartati et al.
, 2.
To optimize firmAos value, it is imperative to disseminate positive news on firm performance to investors, exerting influence and augmenting their total values.
Financial managers must make prudent financial decisions to achieve better performance, arguably leading to improved firm performance and value (Aamir et al.
, 2.
This research investigates the financial ratios that affect firmAos value, especially those operating in the health service industry.
Profitability is an element that affects firmAos value.
More profitable firms will arguably exhibit stronger corporate governance, thus motivating investors to invest in stocks that increase stock prices (Djashan & Agustinus, 2.
Further, working capital is frequently considered to affect firmsAo operating activities, which are critical to effective management.
Effective working capital management affects profitability, business risks, and firmAos value (Altaf, 2.
Jurnal Ekonomi dan Bisnis.
Volume 26 No.
2 Oktober 2023, 431 - 448 FirmAos tangible assets may also affect their values.
Tangible assets help firms improve their values in two ways: as a catalyst for creativity and the creation of new business ideas (Saleh, 2.
and as a credit security that facilitates easier loan access (Ariyanti, 2.
Firm ownership arguably affects firmAos value because institutional owners scrutinize firm performance closely.
Thus, improving firmAos value more effectively (Jentsch, 2.
Managerial and institutional ownership are the two most common firm ownership investigated.
Managerial ownership involves managers owning firmsAo shares to improve firm performance.
Meanwhile, institutional ownership minimizes agency conflicts between managers and stakeholders (Tamala & Hermanto, 2.
Prior studies have suggested that firm ownership positively affects firmAos value (Hasanudin et al.
, 2020.
Putra, 2020.
Tamala & Hermanto, 2.
However, other studies document that institutional ownership does not affect firmAos value (Artamevia & Almalita, 2021.
Setiany et al.
, 2020.
Setyabudi, 2021.
Sukmawardini & Ardiansari.
Ulumi & Hermanto, 2.
This study examines leverage as an independent moderating variable that directly and indirectly affects firmAos value.
Leverage offers tax advantages because it reduces taxes.
However, debt also increases risks due to interest paid (Hidayat, 2.
As demonstrated by prior studies (Aamir et al.
, 2022.
Ariyanti, 2.
, leverage may moderate profitability because reliance on debt can increase profitability, increasing firmAos value.
The managerial balance sheet, which separates the right side as funding sources and the left side as allocation of investment funding, funding sources, especially longterm ones, can finance working capital and assets.
However, the moderating effect of leverage on net working capital and tangible assets remains unknown.
Working capital is important for long-term investments, but it stays on the managerial balance sheet while a company is in operation.
Since net working capital is made up of current assets and liabilities, it could have a short term (Hawawini & Viallet, 2.
Accordingly, this study investigates the impact of profitability, net working capital, tangible assets, and institutional ownership on firmAos value with leverage as the moderating variable.
This study is motivated by various factors, including the discrepancy between firmAos growth and value in the health sector, prior studiesAo inconsistent results, and leverageAos relatively understudied effect on the determinants of firmAos value.
LITERATURE REVIEW
Signalling Theory The signalling theory suggests that owners should be informed of managerial This theory explains why businesses are motivated to disclose voluntary Financial ratios and institutional ownership impact (Sihombing.
Husni.
Zakchon.
financial information.
In this respect, managers disclose financial information to serve investors (Akerlof, 1.
, and they can use the information in investment decisions (Jogiyanto, 2.
Market participants will initially perceive and evaluate newly released information as either a positive signal or a negative signal (Suwardjono, 2.
and are motivated to invest when they consider the information positively.
Agency Theory Agency theory focuses on a contract between managers as agents and owners as principals (Jensen & Meckling, 1.
Agency problems are the consequence of information asymmetry between agents and principals.
In this respect, principals lack sufficient knowledge of managerial performance, while managers, acting as agents, have more firm-specific knowledge.
Hence, principals must develop a mechanism to help them evaluate managerial performance.
Costs associated with this activity include those for developing operating standards and accounting information systems, government oversight, and others.
These costs are frequently labelled as agency costs.
Firm Value Firms aim to increase their values to maximize ownersAo or shareholdersAo wealth (Syamsudin et al.
, 2.
Consequently, shareholders will improve their wealth when share prices increase.
Various financial ratios measure firmAos value, including price to book value (PBV).
PBV measures how firms generate strong profits and cash flows to expand continuously.
Investors arguably prefer firms with higher PBV to maximize their wealth due to their better growth potential (Brigham & Houston, 2.
Profitability Firms generate profits from their product sales.
Profitability ratios refer to firmsAo capacity to utilize their resources effectively to generate profits (Aamir et al.
, 2.
Investors will appreciate more firms with greater profitability, resulting in higher stock prices and firmAos value (Ariyanti, 2.
Profitability also refers to the outcomes of managing investorsAo funds.
This issue is crucial because investors use firmAos profitability to evaluate firmAos ability to generate returns (Sukmawardini & Ardiansari.
Prior studies Aamir et al.
Artamevia & Almalita .
Detama & Laily .
Djashan & Agustinus .
Putra .
indicate that profitability positively affects firmAos value.
Therefore, we propose the following hypothesis:
H1: Profitability positively affects firmAos value.
Net Working Capital (NWC) Net working capital (NWC) constitutes a significant portion of firmAos liquidity, consisting of current assets and liabilities (Jodrzejczak-Gas, 2.
NWC largely affects firmAos profitability and values and is affected by inventory levels, trade payables, and trade receivables (Pandiangan & Sihombing, 2.
Higher inventory Jurnal Ekonomi dan Bisnis.
Volume 26 No.
2 Oktober 2023, 431 - 448 levels increase NWC and profits by reducing supply costs and potential inventory depletion costs and hedging against changes in inventory prices.
Firms can fund their assets with short-term or current debt to reduce their average cost of capital and boost their returns (Altaf, 2.
Prior studies Awan et al.
Kasim et al.
Senan et al.
argue that firms with greater NWC are likely to increase their stock prices.
The preceding discussion leads us to propose the following hypothesis:
H2: Net working capital positively affects firmAos value.
Tangible Assets Assets refer to resources controlled by a firm, consisting of tangible, intangible, and other assets.
Asset tangibility, or the percentage of fixed assets to total assets, can be used to calculate firmAos tangible assets.
Tangible wealth our senses can identify refers to tangible assets (Sugiama, 2.
Prior studies Ariyanti .
Artamevia & Almalita .
Djashan & Agustinus .
demonstrate that tangible assets .
he ratio of a firmAos tangible assets to its total asset.
can increase firmAos value.
Therefore, we propose the following hypothesis:
H3: Tangible assets positively affect firmAos value.
Institutional Ownership Managers and owners may have different, even conflicting objectives (Jensen & Meckling, 1.
As a result, institutional ownership and other aspects of a sound ownership structure are essential to coordinating their goals (Setiany et al.
, 2.
Firms with institutional equity ownership are typically more valuable because institutional owners are more motivated to monitor managersAo decisions and actions more closely.
This argument is consistent with the idea that institutional shareholders are better at monitoring because they have more expertise and a superior financing structure than other shareholders (Jentsch, 2.
Prior studies Purba & Effendi .
Putra .
Sakawa & Watanabel .
demonstrate the beneficial impact of institutional ownership structure on firmAos value.
Thus, this study develops the following hypothesis:
H4: Institutional ownership positively affects firmAos value.
Leverage Financial leverage refers to firmAos reliance on external funding sources that result in fixed costs, encouraging firms to pay incurred costs (Sihombing, 2.
Firms with lower .
debt ratios exhibit lower .
risks, and excessively leveraged Financial ratios and institutional ownership impact (Sihombing.
Husni.
Zakchon.
firms tend to exhibit lower market values (Harahap et al.
, 2.
This study uses leverage as an independent and a moderating variable simultaneously.
Debt to assets ratio (DAR) is a commonly used leverage ratio that measures the extent of a firmAos assets funded by debt.
Further, the efficiency and effectiveness of firmAos asset utilization determine firmAos value (Hidayat, 2.
Earlier studies Artamevia & Almalita .
Detama & Laily .
Harahap et al.
Hidayat .
demonstrate that leverage positively affects firmAos value.
Accordingly, we propose the following hypothesis:
H5: Leverage positively affects firmAos value.
Leverage as a Moderating Variable Leverage may also moderate profitability, which measures firmsAo ability to generate profits from their assets or capital.
Firms can use debt to increase their capital, and appropriate funding sources will arguably boost profitability, raising the companyAos market worth (Ariyanti, 2.
Prior studies Aamir et al.
Ariyanti .
suggest that capital structure positively moderates the effect of profitability on firmAos value.
H6: Leverage moderates the effect of profitability on firmAos value.
Leverage may also moderate the impacts of tangible assets and NWC on firmAos Funding current assets as the significant portion of NWC with debt offers several advantages, such as reducing the likelihood of refinancing and after-maturity credit risks.
Consequently, firms do not have to pay additional interest from other funding sources.
In this respect.
DAR is frequently used as a proxy for these benefits.
These benefits enable firms to exploit NWC debt financing to boost their values (Altaf.
H7: Leverage moderates the effect of net working capital on firmAos value.
Meanwhile, tangible assets enable firms to acquire loans more easily and less costly through mortgages.
Thus, firms can incur lower borrowing costs using tangible assets as collateral, resulting in higher leverage ratios (Ariyanti, 2.
Based on the above arguments, we propose the following hypothesis:
H8: Leverage moderates the effect of tangible assets on firmAos value.
Jurnal Ekonomi dan Bisnis.
Volume 26 No.
2 Oktober 2023, 431 - 448 Based on the above hypotheses, we develop a research framework as follows:
Debt to Asset Ratio (Z) Return on Asset (X.
Net Working Capital Ratio (X.
FirmAos Value (Y) Tangible Asset (X.
Institutional Ownership (X.
(X.
Figure 1
Research Framework
RESEARCH METHOD
Our population consists of seventeen publicly listed Indonesian firms in the healthcare industry in 2022.
We use the purposive sampling technique based on several criteria to generate representative sample firms (Sugiyono, 2.
Specifically, the sampling technique generates nine firms with complete financial reports.
This sampling data was limited to nine listed healthcare stocks with a complete financial report for 2020 Ae 2021.
Table 1 Process of Sample Selection Information The total amount of healthcare sector in the health services and health equipment subsector listed on the IDX market Companies that have just conducted an Initial Public Offering (IPO) on the IDX market after the first quarter of 2020 or have been de-listed from the IDX market during the research period .
Number of Research Samples Amount Nine stock issuers out of the seventeen stock issuers with population statistics fulfilled the sampling criteria, such as Metro Healthcare Indonesia.
Tbk (CARE).
Medikaloka Hermina.
Tbk (HEAL).
Itama Ranoraya.
Tbk (IRRA).
Mitra Keluarga Karyasehat.
Tbk (MIKA).
Prodia Widyahusada.
Tbk (PRDA).
Royal Prima.
Tbk (PRIM).
Sarana Meditama Metropolitan.
Tbk (SAME).
Siloam International Hospitals.
Tbk (SILO), and Sejahteraraya Anugrahjaya.
Tbk (SRAI).
Panel data regression analysis was applied as the analytical technique to assess the relationship between the dependent and independent variables.
We use Moderated Regression Analysis (MRA) through E-views 12 and Microsoft Office Excel.
Quarterly data over two years .
0 to 2.
are used as time series data.
An analytical Financial ratios and institutional ownership impact (Sihombing.
Husni.
Zakchon.
method known as inferential analysis is used to assess the degree of similarity between findings from a sample and those expected from the population at large.
Panel data multi-regression means a combination of data between the time series and the cross-section.
There are three types of panel data multi-regression The common effect model with the ordinary least square (OLS) technique assumes the time series and the cross-section data, while the cross-section data has the same behaviour over time.
The formula of the common effect model is as follows:
yit =Oyi yu1 Xit yuAit .
The fixed effect model with least squares dummy variable (LSDV) techniques assumes a differentiation between individual data is accommodated by intercept This model uses a dummy variable technique to catch intercept differences and assume the coefficient .
will be constant between company and time-series, while intercept differentiates between companies.
The formula of the fixed effect model is as follows:
yit = (Oyi i ) 1 Xit Ait .
The random effect model with generalized least squares (GLS) estimates the data panel, while the interference variable is related to constant coefficient assumptions, sample error, and times.
Random effect models can remove heteroscedasticity and are formulated as follows:
yit =Oyi 1 X it (Ait Oe i ) .
Determining the best model by executing panel data has three statistical The Chow test chooses the suitable model between a common or fixed effect The Chow test adds dummy variables to get a different intercept by checking the residual sum of squares (RSS) value.
The Hausman test is examined to choose the best model between the fixed or random effect models.
The Hausman test checks an error between an independent variable and others.
The Lagrange multiplier test chooses the best model between the random or common effect models (Basuki & Prawoto, 2.
The F-test analyzes multiplier regression analysis and describes the effect of all independent variables on the dependent variable simultaneously (Ghozali, 2.
T-statistic tests show how to affect an independent variable to explain a dependent variable (Ghozali, 2.
The significance level for hypothesis testing in this research uses an alpha value of 10% or 0.
It indicates that the error tolerance is only 10%, and the findings are 90% accurate when concluding (Ghozali, 2.
The following describes the analysis model with the MRA approach used in this work.
Jurnal Ekonomi dan Bisnis.
Volume 26 No.
2 Oktober 2023, 431 - 448 PBVit = 0 1 ROAit 2 NWCit 3 TAit 4 INSTit 5 DAR it 6 ROAit O DAR it 7 NWCit O DAR it 8 TAit O DAR it eit .
Information:
1 Ae 8 PBVit ROAit NWCit TAit INSTit DARit ROAit*DARit NWCit*DARit TAit*DARit : Constant parameter : Regression coefficients : Price to book value .
urrent stock price/book valu.
for firm ycn at time yc : Return on asset .
et profit/total asse.
for firm ycn at time yc : Net working capital .
urrent active/current liabilit.
for firm ycn at time yc : Tangibility of the asset .
otal asset-intangible asset-total liabilit.
for firm ycn at time yc : Institutional ownership .
nstitutional ownership/total listed stoc.
for firm ycn at time yc : Debt-to-asset ratio .
otal loan/total asse.
for firm ycn at time yc
: Interaction between Leverage and Profitability for firm ycn at time yc
: Interaction between Leverage and Net Working Capital for firm ycn at time yc
: Interaction between Leverage and Tangible Assets for firm ycn at time yc
: Standard error for firm ycn at time yc
RESULTS AND DISCUSSION
Descriptive Statistical Analysis Research variables that are represented by descriptive statistics are broad examples of data.
The descriptive statistical analysis results will include the research data's mean, maximum, minimum, and standard deviation.
The outcomes of this study's summary statistical analysis are listed in Table 2 below.
Table 2
Descriptive Statistics PBV
ROA
NWC
Mean Maximum Minimum Std.
Dev.
Source: Processed data .
INST
DAR
Based on Table 2, the PBV averages 3.
612 and a standard deviation of 2.
In the second quarter of 2020.
SAME had the lowest score .
In the fourth quarter of 2020.
IRRA had the best score of 14.
The ROA variable has a mean of 0.
042 and 073 as standard deviation.
In the third quarter of 2020.
SAME reported the lowest value of -0.
In the fourth quarter of 2021.
PRDA reported the highest value of The NWC, measured by the Net Working Capital Ratio (NWCR), has a 0.
mean and 0.
228 standard deviation.
The lowest value is -0.
336, owned by SRAJ in the fourth quarter of 2021.
Then.
IRRA owns the highest NWC of 0.
698 in the first quarter The tangible asset is measured using the assets tangibility, which calculates the total of tangible assets compared to the total assets owned by the company.
From the result, it could be perceived the mean is 0.
491 and 0.
219 standard deviation, and the lowest value is 0.
029, owned by IRRA in the second quarter of 2021.
Then, the highest is 0.
936 owned by SAME in the second quarter of 2020.
Financial ratios and institutional ownership impact (Sihombing.
Husni.
Zakchon.
The institutional ownership (INST) is known to have a mean of 0.
664, with 199 as the standard deviation.
PRIM owns the lowest ownership of 0.
319 in the first quarter of 2021.
The highest is 0.
927 owned by SRAJ in the fourth quarter of 2021.
The DAR as a moderating variable has a mean of 0.
299 with 0.
203 as standard deviation, with the lowest data of 0.
043 at CARE in the second quarter of 2020.
Then, the highest was 0.
718 owned by IRRA in the second quarter of 2021.
Panel Data Regression Equation Results Panel data regression analysis can be executed using three models: the common effect, fixed effect, or random effect model estimation test.
Each model was tested to determine the most suitable model for the three-panel data models above.
From the results of the Chow test, the researcher found a chi-square probability of 0.
000, which is less than 0.
Thus, the fixed effect model is more appropriate to use.
Table 3 Statistical Result of Chow Test and Hausman Test Characteristic Statistic Result Decision Chow Cross-section F 340 .
000 The fixed effect model is suitable Hausman Cross-section random 000 The fixed effect model is suitable Source: processed data .
Furthermore, the Hausman test was carried out, and a chi-square probability of 000 was obtained, which returned less than 0.
So, the fixed effect model is more appropriate than the random effect model.
Because two tests have found that the fixed effect model is the best, the Lagrange Multiplier test is unnecessary.
Classical assumptions test Using panel data benefits research because the data used are more descriptive, have greater variance, lower collinearity, greater degrees of freedom, and better Therefore, it does not require testing the classical assumptions (Gujarati et , 2.
Hypothesis Test Results After determining the best model, it is necessary to test the hypothesis through the R test.
F test, and statistical t-test.
Table 4 Coefficient Determination Test Result Using the Fixed Effect Model Cross-section fixed .
ummy variable.
R-squared Adjusted R-squared Source: processed data .
Table 4 explains that the R-squared is 0.
It means the dependent variable in this study will be affected by the independent variable of 86.
Meanwhile, the 11% comes from the influence of other variables.
The probability of the F- Jurnal Ekonomi dan Bisnis.
Volume 26 No.
2 Oktober 2023, 431 - 448 statistic is 0.
0000, which is lower than 0.
So, it can be concluded that the independent variables will simultaneously influence the dependent variable.
Table 5 F-test Result Using the Fixed Effect Model Cross-section fixed .
ummy variable.
Prob(F-statisti.
Durbin-Watson stat Source: processed data .
Table 5 explains that the F-test result has a probability value 0.
ower It means all independent variables simultaneously impact the dependent Table 6 t-partial Test Result Using the Fixed Effect Model Variable Coefficient Std.
Error t-Statistic Prob.
ROA
NWC
INST
DAR
ROA*DAR
NWC*DAR
TA*DAR
Source: processed data .
Note H1 is rejected H2 is rejected H3 is rejected H4 is rejected H5 is accepted H6 is rejected H7 is rejected H8 is accepted Based on Table 5, the coefficients of each variable that will form the model in this study are obtained as follows:
C = 4.
752ycIycCya Oe 2.
715ycAycOya Oe 6.
127ycNya Oe 0.
858yaycAycIycN 15.
117yayaycI Oe ycEyaAycO 036ycIycCya O yayaycI Oe 12.
855ycAycOya O yayaycI Oe 16.
094ycNya O yayaycI .
The impact of profitability ratio on the firmAos value The panel data regression outcomes show that ROA has a coefficient of 6.
with a probability value of 0.
As such.
H1 is rejected.
The results show that profitability as a proxy for ROA does not affect the company value of the healthcare industry listed on the IDX in 2020-2021.
This aligns with previous studies (Hidayat.
Mauludi & Budiarti, 2019.
Putra et al.
, 2017.
Sukmawardini & Ardiansari, 2.
, which stated that profitability does not affect firmAos value.
One possibility is that this paper was carried out during the COVID-19 pandemic, which would harm the company's income.
If income decreases, then ROA will also decrease, which causes a reduction in the effect of ROA on firmAos value.
This also occurred in previous research Mauludi & Budiarti .
which used a sample of pharmaceutical companies listed on the IDX for 2014-2018.
During that period, most pharmaceutical companies made losses, which caused the results of their research to show no effect on the profitability of firmAos value.
Financial ratios and institutional ownership impact (Sihombing.
Husni.
Zakchon.
The impact of working capital ratio on the firmAos value The results manifest that NWC has a coefficient of -2.
716 with 0.
probability value.
So.
H2 is rejected.
It means NWC doesnAot affect firmAos value.
other words, working capital management proxied by NWC does not affect the company value of the healthcare sector listed on the IDX in 2020-2021.
It is similar to a study by Putra et al.
which stated that NWC does not affect firmAos value.
This seems to indicate that a lot of working capital to minimize operational risk is inversely proportional to the desired level of profitability.
Management must consider to what extent working capital must be owned before sacrificing profitability and company Further studies on optimal working capital thresholds must be developed (Le.
The impact of tangible asset on the firmAos value The outcomes show that the tangible asset (TA) has a coefficient of -6.
127 with 087 probability value.
Therefore.
H3 is accepted.
This means that tangible asset variables have an effect, even though they have a negative influence.
Tangible assets are proxied for the tangibility of assets, or the ratio between tangible assets and total assets harms company merit in the healthcare sector listed on the IDX in 2020-2021.
It is similar to a study by Saleh .
which stated that tangible assets negatively affect company value.
The tangible or fixed assets require very large funds to buy these This will reduce retained earnings by the company because these profits will be used to finance expensive fixed assets.
Companies will use retained earnings because it is the cheapest source of funding.
However, reduced retained earnings will reduce profits distributed to investors.
So, investors will be less interested in investing their money in the company, which will reduce the stock price and firmAos value.
The impact of institutional ownership company on the firmAos value The outcomes manifest that INST has a coefficient of -0.
858 with 0.
So.
H4 is rejected.
In other words.
INST does not affect the company value of the healthcare sector listed on the IDX in 2020-2021.
This aligns with earlier research, such as Artamevia & Almalita .
Setiany et al.
Sukmawardini & Ardiansari .
, that showed institutional ownership does not affect firmAos value.
According to Artamevia & Almalita .
, high institutional ownership does not ensure that the supervision of company management is also more effective and There is also the possibility of agency problems due to information asymmetry between investors and management, which causes the oversight function of institutional investors to not be optimal.
The impact of leverage on the firmAos value The results above show that the leverage variable proxied by DAR has a coefficient of 15.
118 with 0.
001 probability value.
Thus.
H5 is accepted.
It means that leverage proxied on the DAR positively affects company value in the healthcare sector Jurnal Ekonomi dan Bisnis.
Volume 26 No.
2 Oktober 2023, 431 - 448 in the health services and medical equipment sub-sector listed on IDX in 2020-2021.
ItAos similar to previous studies (Artamevia & Almalita, 2021.
Detama & Laily, 2021.
Harahap et al.
, 2020.
Hidayat, 2018.
Prabowo et al.
, 2.
that show leverage with various proxies has a positive effect on company value.
ItAos related to the theory of Modigliani & Miller .
, which stated that if a company uses debt to carry out operations close to 100%, the firmAos value will also be close to the highest.
Through debt, investors feel that companies can maximize profits with small sources of funds without depending on funds from investors (Harahap et al.
, 2.
The thing to remember is that high leverage alone will not be able to maximize the value of the Research by Detama & Laily .
showed a high level of leverage in companies in their study using pharmaceutical companies.
It must also be balanced with an optimal capital structure to maximize company value.
The moderating effect of leverage in the impact of profitability ratio on firmAos The outcomes show that the interaction variable between profitability and leverage proxied by the DAR has a coefficient of -7.
037 with a probability of 0.
In other words.
H6 is rejected.
It means that leverage cannot moderate the profitability effect on firmAos value.
The outcomes appear leverage cannot moderate the effect of proxied profitability on ROA on firmAos value in the healthcare sector, particularly in the health services and medical equipment sub-sector listed on IDX in 2020-2021.
Sources of capital derived from debt cannot always maximize profitability and even reduce the firmAos value.
Kraus & Litzenberger .
stated that there is a certain limit before debt reduces firmAos value.
This threshold can certainly change during a crisis such as the COVID-19 pandemic.
Companies with high leverage ratios will make investors worry that the company will not be able to cover costs incurred due to debt and will experience bankruptcy.
The moderating effect of leverage in the impact of net working capital on firmAos The results show that the interaction between net working capital and leverage has a coefficient of 12.
855 with a probability of 0.
Thus.
H7 is rejected.
Leverage cannot moderate the effect of net working capital on company merit in the healthcare sector in the health services and health equipment subsectors listed on the IDX in 20202021.
This can be explained by referring to Altaf .
Le .
which showed that NWC negatively affects firmAos value.
As discussed above, investors value restrictive working capital policies more highly, and companies with too much working capital are undervalued.
So, the company's value will certainly decrease if it is known that it only owes a lot of working capital.
The moderating effect of leverage in the impact of tangible assets on firmAos value The outcomes manifest that the interaction between tangible assets and leverage has a coefficient of -16.
095 with a probability of 0.
Therefore.
H8 is Financial ratios and institutional ownership impact (Sihombing.
Husni.
Zakchon.
In this case, leverage can moderate the effect of tangible assets on corporate value in the healthcare sector in the health services and health equipment sub-sectors listed on IDX in 2020-2021.
This is explained by referring to Saleh .
that tangible assets negatively affect firmAos value.
The tangible assets have a negative effect because funding for these assets requires very high costs, and the source of funds usually comes from retained earnings, which should be distributed to shareholders.
Suppose these tangible assets can be funded with other funds, such as debt.
In that case, the negative effect of tangible assets on company value can also be reduced because retained earnings distributed to shareholders are maintained to increase investors' evaluation of the company.
CONCLUSIONS
This study concludes that profitability does not affect company value due to decreased revenue during the pandemic.
NWC does not affect firmAos value because a high amount of working capital alone cannot increase company profitability.
Tangible assets do not impact firmAos value because the costs required to invest in this type of asset are very high.
Investment judgment will be diminished if residual earnings are used to purchase it.
Institutional ownership does not affect firmAos value.
There may still be agency problems due to information asymmetry between investors and management, which causes the oversight function of institutional investors to not be Leverage is examined as one of the independent variables and a moderating Leverage positively affects firmAos value since it can reduce the tax charged to the company, thereby increasing its income to a certain extent.
Leverage cannot moderate the profitability effect on firmAos value.
So, companies should not use too much debt to prevent interest expenses from being too large and compromising company value.
Leverage cannot control the NWC effect on firmAos value.
Companies should not increase working capital using debt because it will further reduce firmAos In contrast, leverage can moderate the effect of tangible assets on firmAos value by weakening the negative effects of tangible assets.
Therefore, companies should use debt to invest in tangible assets.
Our research has several limitations.
The data are too short .
wo years taken during the pandemic crisi.
Therefore, it will be difficult to apply in general.
Future research could consider non-crisis periods such as the COVID-19 pandemic or compare the effects of these variables if economic conditions are normal.
Further research needs to be carried out on whether it was caused by a decrease in profits during the pandemic or whether other reasons caused companies in the healthcare sector to have a company value not affected by profitability.
Subsequent research can also change proxy variables.
For example, profitability using return on equity, firmAos value with price-earnings ratio, or company ownership with managerial ownership.
Jurnal Ekonomi dan Bisnis.
Volume 26 No.
2 Oktober 2023, 431 - 448 even changing the independent variable considering that there is still a 13.
influence from variables outside this study.
REFERENCES