Research Article
Financial Performance Assessment of LQ45 Companies using DuPont Analysis during the Period of 2013-2017
@INPROCEEDINGS{10.4108/eai.12-11-2018.2288764, author={Muhammad Fuad and Rini Mastuti and Rita Meutia and Cici Syaila}, title={Financial Performance Assessment of LQ45 Companies using DuPont Analysis during the Period of 2013-2017}, proceedings={Proceedings of the 1st International Conference on Finance Economics and Business, ICOFEB 2018, 12-13 November 2018, Lhokseumawe, Aceh, Indonesia}, publisher={EAI}, proceedings_a={ICOFEB}, year={2019}, month={10}, keywords={lq45 dupont analysis roe npm tato em}, doi={10.4108/eai.12-11-2018.2288764} }- Muhammad Fuad
Rini Mastuti
Rita Meutia
Cici Syaila
Year: 2019
Financial Performance Assessment of LQ45 Companies using DuPont Analysis during the Period of 2013-2017
ICOFEB
EAI
DOI: 10.4108/eai.12-11-2018.2288764
Abstract
The financial performance of a listed company will affect the market sentiment on the company. Therefore, financial performance needs to be assessed periodically and in detail. The study aims to assess the financial performance of LQ45 listed companies using DuPont analysis, which provides an in-depth review by decomposing Return of Equity (ROE). 34 companies are selected purposively as samples, and secondary data is sourced from the financial statements for the period of 2013-2017. Results showed the majority of LQ45 companies had relatively poor performance based on ROE, which was attributed to the value of profit margin, total assets turnover, and equity multiplier that fluctuates. It is recommended the company should increase its asset productivity in generating business profit through increased sales. Government interventions to create a conducive business environment are also needed.