The Effect of Profitability and Leverage Towards Company Performance in Indonesia and Malaysia
Abstract
One important factor that can influence company performance is profitability and leverage. profitability measures a business's ability to generate profits while leverage measures the level of debt use in a company's capital structure. The aim of this research is to evaluate the effect of profitability and leverage on company performance, as measured by Return on Assets (ROA), Debt to Equity Ratio (DER), and Return on Equity (ROE). The research used is quantitative research and uses secondary data. Data collection was carried out using purposive sampling techniques which have been published in the media. The sample used in the research was 120 samples, with trials of 10 financial reports of transportation companies in Indonesia and 10 financial reports of transportation companies in Indonesia, Malaysia. Data processing using EViews 13 consists of Model Selection Test, Regression Test, and Hypothesis Test. The research results show that , 1) there is an influence of profitability and leverage simultaneously on the performance of companies in Indonesia and Malaysia during COVID-19, 2) there is an influence of profitability on the performance of companies in Indonesia and Malaysia during COVID-19, 3) There is no influence of leverage on company performance in Indonesia and Malaysia during COVID-19.
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