Role Of Profitability, Business Risk, And Intellectual Capital In Increasing Company Value

In order to improve the welfare of shareholders, the company needs to achieve and maintain the company value owned through the utilization of the company's resources. The goal of this study is to see how profitability, business risk, and intellectual capital affect firm value. In recent years there has been a decline in the value of the mining sector due to various factors that affect it, which are associated with a decline in the value of shares. This study is the first to examine the company value of mining companies that are associated with business risk and intellectual capital where both factors are important factors that must be considered in mining companies. This research is quantitative research using panel data regression analysis techniques through the support of the Eviews 11 program. The analysis included 44 mining businesses that were listed on the Indonesia Stock Exchange between 2016 and 2019. The findings revealed that profitability as defined by Return On Equity (ROE), business risk as measured by business risk (BRISK), and intellectual capital as measured by value added intellectual capital (VAICTM) had no effect on company value. From this, management must pay more attention to the company's business risks, because this business risk is related to the sustainability of the company, the company's ability to pay off obligations, and the willingness of investors to invest in the company and the company's ability to get funds in carrying out its activities. Limitations in this study, it is advisable to add variables related to other research variables in relation to company value and add the range of research periods that may be able to give better results

Role Of Profitability, Business Risk, And Intellectual Capital In Increasing Firm Value

This research illustrates the importance of firm value, both to investors and companies. Investors assess that an increase in the value of a company indicates a positive view of the company's performance, which leads to an investment decision. Besides that, an increase in the value of the company can indicate that the company is getting closer to achieving its goal, namely increasing the welfare of its stakeholders. Background Issues: In recent years, there has been a decline in the value of firms in the mining sector due to various factors that have affected it, which has resulted in a decrease in the value of the shares in several of the sub-sectors, especially the coal mining and petroleum sub-sectors. Novelty: This study examines the business risk and intellectual capital that are typical of firms in the mining industry with the generalized moments’ methods. Research Methods: This research is a quantitative study that uses the generalized moments methods, where the robust least square test determines which model is more suitable for use in the research. The variables in this study consist of profitability, intellectual capital, and business risk, with variable controls being the gold price, exchange rate, and petroleum price. This study uses annual financial statements from mining companies that are listed on the Indonesia Stock Exchange. These statements include balance sheets and income statements. Finding/Results: These findings reveal that profita-bility, intellectual capital, and business risk affect the value of a company. Macro-economic factors as the variable controls, namely gold prices, exchange rates, and petroleum prices, also affect the value of a company. Therefore, based on the research’s results, management must pay attention to internal factors or company micro factors (profitability, intellectual capital, and business risks) and macroeco-nomic factors (gold prices, exchange rates, and petroleum prices) to increase company value. This is because investors use these factors when making decisions to invest in the mining sector. Conclusion: There are several important factors that, in principle, increase the value of a company. These factors come from internal and external factors (macroeconomics). This article successfully demonstrates the importance of profitability, intellectual capital, and business risk in supporting firm value. The results also showed that the gold price, exchange rate, and the price of oil have an effect on the price of mining stocks, which are used to measure changes in the economy

Role of Profitability, Business Risk, and Intellectual Capital in Increasing Firm Value

This research illustrates the importance of firm value, both to investors and companies. Investors assess that an increase in the value of a company indicates a positive view of the company's performance, which leads to an investment decision. Besides that, an increase in the value of the company can indicate that the company is getting closer to achieving its goal, namely increasing the welfare of its stakeholders. Background Issues: In recent years, there has been a decline in the value of firms in the mining sector due to various factors that have affected it, which has resulted in a decrease in the value of the shares in several of the sub-sectors, especially the coal mining and petroleum sub-sectors. Novelty: This study examines the business risk and intellectual capital that are typical of firms in the mining industry with the generalized moments’ methods. Research Methods: This research is a quantitative study that uses the generalized moments methods, where the robust least square test determines which model is more suitable for use in the research. The variables in this study consist of profitability, intellectual capital, and business risk, with variable controls being the gold price, exchange rate, and petroleum price. This study uses annual financial statements from mining companies that are listed on the Indonesia Stock Exchange. These statements include balance sheets and income statements. Finding/Results: These findings reveal that profita-bility, intellectual capital, and business risk affect the value of a company. Macro-economic factors as the variable controls, namely gold prices, exchange rates, and petroleum prices, also affect the value of a company. Therefore, based on the research’s results, management must pay attention to internal factors or company micro factors (profitability, intellectual capital, and business risks) and macroeco-nomic factors (gold prices, exchange rates, and petroleum prices) to increase company value. This is because investors use these factors when making decisions to invest in the mining sector. Conclusion: There are several important factors that, in principle, increase the value of a company. These factors come from internal and external factors (macroeconomics). This article successfully demonstrates the importance of profitability, intellectual capital, and business risk in supporting firm value. The results also showed that the gold price, exchange rate, and the price of oil have an effect on the price of mining stocks, which are used to measure changes in the economy

Does Intellectual Capital Affect the Volatility of Returns? An Empirical Investigation on Italian Listed Companies

In modern information economies, economic success increasingly depends on the ability to apply knowledge and to transform it into firm value. While intellectual capital plays a critical role in firm success, it is an intangible asset that is difficult to measure and that is unrecorded by the firm. Difficulties in measuring intellectual capital, as well as the dynamic nature of the firms that rely on it, may lead to greater stock market volatility/risk. Consistent with this expectation, in statistical tests we find that intellectual capital, measured by VAIC, positively relates to the volatility of stock returns section among Italian listed companies. We find this positive relation for two components of a firm’s risk: systematic risk and specific risk. The finding is relevant to both investors concerned with understanding the risk/reward balance of particular investments and regulators concerned with market stability

The Influence of Macroeconomic and Microeconomic Variables on Capital Structure and Financial Performance

Penelitian ini meneliti tentang pengaruh variabel makroekonomi dan mikroekonomi terhadap struktur modal dan kinerja keuangan dari Perusahaan-Perusahaan Makanan dan Minuman selama periode 2004-2010. Dengan menggunakan metode Partial Least Square (PLS), hasil menunjukkan bahwa variabel makroekonomi dan mikroekonomi memiliki pengaruh negatif yang signifikan terhadap kinerja keuangan. Sedangkan struktur modal menunjukkan pengaruh positif yang signifikan terhadap kinerja keuangan. Hal ini mengindikasikan bahwa Perusahaan yang menguntungkan lebih bergantung pada hutang sebagai alat pembiayaan mereka yang utama.Kata kunci: Struktur modal,Indonesia, Kinerja Keuangan, Perusahaan Makanan dan MinumanThis research investigated the influence of macroeconomic and microeconomic variabl eon capital structure and financial performance of Indonesia Food and Beverage Companies during period 2004-2010. Using Partial Least Square Method, the result showed that Macroeconomic and Microeconomic Variable has significant negative influence on Financial Performance. However, the influence of Capital Structure on Financial Performance showed significantly positive. This suggested that profitable firms depend more on debt as their main financing option

Recognizing Risk in Human Capital Investments: A Real Options Approach to Strategic Human Resource Management

An issue that has not yet been explored in the field of strategic human resource management (SHRM) is that of managing the ‘risks’ involved in human capital management of the firm. We address this issue using the real option theory framework. We argue that certain HR practices manage risk and generate opportunities for the firm by creating \u27options\u27 for its human capital management. These HR options help ensure stability of returns from human capital and thus sustain competitive advantage. Different types of HR options and the role of certain HR practices in creation of these options are discussed

MODELING MANAGERIAL ACTIVITY, A CHALLENGE OR A NEED INTO THE INTERCONECTED ECONOMIC SPACE

In the European economic area, which becomes more and more interconnected, the management system provides ways of obtaining a performance which, on changing the size of the firm, sometimes prove to be inadequate. During that lapse of time from triggering the action when the results can be measured should be as small continuously decreasing. The information required to be used in the decision support are required more avid. The manager will use different models for measurements of indicators of discrete evaluation, but it proves that not to be the best solution. Only the availability of this information will enable them to make better decisions, and by changing the way of how the decision making needs to get a deep effect on those decisions which are currently in action.interconnected economy, managerial activity, sustainable development, management model, resource evaluation, risk management