THE INFLUENCE OF FINANCIAL PERFORMANCE TOWARD PRICE TO BOOK VALUE IN PROPERTY AND REAL ESTATE INDUSTRY IN INDONESIA

Abstract

This study examines the influence factor of company value that proxy by price to book value ratio. The factors are taken from company financial performance such as price-earnings ratio, firm size, debt to assets ratio, return on equity and earnings per share. This research sample is taken from the property and real estate industry in period 2014-2017 using a quantitative method with purposive sampling from the website of the Indonesia Stock Exchange. This research has 184 observations from 46 companies in 4 years. The classical assumption has been passed to ensure the valid result of this research. This research is used in multiple linear regression to find the result. The empirical evidence of this research is indicating price earnings ratio, debt to assets ratio, and earnings per share has partially significant influence towards price to book value ratio, while the firm size and return on equity has insignificant influence towards price to book value ratio. Simultaneously, those independent variables altogether have influence price to book value ratio by 17.70% and the rest is influenced by other variables that not examined in this research.