Profitability as a Mediation Factor: A Test of The Relationship of Capital Structure to Company Value

Akhmadi Akhmadi; Liah Culiah; Helmi Yazid

Proceedings of the International Conference on Sustainability in Technological, Environmental, Law, Management, Social and Economic Matters, ICOSTELM 2022, 4-5 November 2022, Bandar Lampung, Indonesia

Research Article

Profitability as a Mediation Factor: A Test of The Relationship of Capital Structure to Company Value

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@INPROCEEDINGS{10.4108/eai.4-11-2022.2327869,
    author={Akhmadi  Akhmadi and Liah  Culiah and Helmi  Yazid},
    title={Profitability as a Mediation Factor: A Test of The Relationship of Capital Structure to Company Value},
    proceedings={Proceedings of the International Conference on Sustainability in Technological, Environmental, Law, Management, Social and Economic Matters, ICOSTELM 2022, 4-5 November 2022, Bandar Lampung, Indonesia},
    publisher={EAI},
    proceedings_a={ICOSTELM},
    year={2023},
    month={9},
    keywords={capital structure firm value profitability},
    doi={10.4108/eai.4-11-2022.2327869}
}

Akhmadi Akhmadi
Liah Culiah
Helmi Yazid
Year: 2023
Profitability as a Mediation Factor: A Test of The Relationship of Capital Structure to Company Value
ICOSTELM
EAI
DOI: 10.4108/eai.4-11-2022.2327869

Akhmadi Akhmadi¹^,*, Liah Culiah¹, Helmi Yazid¹

1: Department of Management, Faculty of Economics and Business, University of Sultan Ageng Tirtayasa

*Contact email: akhmadi@untirta.ac.id

Abstract

This study investigates how profitability affects the link between capital structure and business value as a mediating factor. 38 companies participated in the study on real estate and property companies listed on the Indonesia Stock Exchange from 2013 to 2017. Path analysis from the multivariate regression was employed for data analysis. The findings of the study demonstrate how important and beneficial the capital structure is to value. Profitability does not, however, act as a mediating factor in the connection between capital structure and business value. Because of the restrictions of the research object and the proxies used for each observed variable, it is impossible to generalize the study's findings.

Keywords: capital structure firm value profitability

Published: 2023-09-11
Publisher: EAI

: http://dx.doi.org/10.4108/eai.4-11-2022.2327869