THE FINANCIAL RATIOS THAT AFFECT EARNING GROWTH IN INFRASTRUCTURE COMPANIES

Abstract

First of all, the researcher would like to express her greatest gratitude to Almighty God, so she can finish this thesis as one condition to achieve Bachelor Degree in President University. The objective of this research to analyze the influence of financial ratios towards earning growth in infrastructure companies in Indonesia. The financial ratios that the researcher used are Cash Ratio (CSR) represent liquidity ratio, Debt to Equity Ratio (DER) represent solvability ratio, Net Profit Margin (NPM) represent probability ratio and Total Asset Turnover (TAT) represent activity ratio. This research method are quantitative method and data used in this research is secondary data from data that has been published and obtained from 12 infrastructure companies in Indonesia Stock Exchange (IDX) period 2012-2016. To analyze the data, the researcher used multiple regression model. The result shows, NPM and TAT significantly influence the earning growth, while CSR and DER have no significant influence towards earning growth. The variation of Earning Growth that can be explained by the variables CSR, DER, NPM and TAT is about 36,1%. Meanwhile, the rest can be explained by other variables that were not examined in this research.