Analysis of Firm Value in Manufacturing Companies Through Profitability and Company Size: The Role of Concentrated Ownership as a Signal to Investors

Authors

  • Rahmi Nur Islami Universitas Borneo Tarakan Author
  • Kartini Kartini Universitas Borneo Tarakan Author
  • Rizky Agusriyanti Irna Universitas Borneo Tarakan Author
  • Kholiqul Lutfi Alfizar Yonti Universitas Borneo Tarakan Author
  • Suseno Hadi Purnomo Universitas Wahid Hasyim Semarang Author

DOI:

https://doi.org/10.35334/hw800s53

Keywords:

Firm Value;, Profitability; , Company Size; , Concentrated Ownership

Abstract

This study aims to analyze the effect of profitability and firm size on firm value, with concentrated ownership as a moderating variable in manufacturing companies listed on the Indonesia Stock Exchange during the 2020–2024 period. This research employs a quantitative approach using panel data regression and Moderated Regression Analysis (MRA). The model selection results indicate that the Fixed Effect Model (FEM) is the most appropriate model. The sample consists of 10 manufacturing companies selected through purposive sampling over five years.The results show that profitability and firm size have a positive and significant effect on firm value. Concentrated ownership also has a positive effect on firm value and strengthens the relationship between profitability and firm value, but does not moderate the effect of firm size on firm value.Practically, these findings suggest that investors in the Indonesian capital market should prioritize firms with strong profitability and concentrated ownership structures, as these factors signal higher firm value and better monitoring mechanisms. For corporate managers, the results highlight the importance of improving profitability performance and maintaining an effective ownership structure to enhance market valuation and investor confidence. These findings reinforce signaling theory in explaining how financial performance and ownership structure influence firm value.

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Published

04/27/2026

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Articles

How to Cite

Nur Islami, R., Kartini, K., Agusriyanti Irna, R., Lutfi Alfizar Yonti, K., & Hadi Purnomo, S. (2026). Analysis of Firm Value in Manufacturing Companies Through Profitability and Company Size: The Role of Concentrated Ownership as a Signal to Investors. Jurnal Ekonomika, 17(1), 58-71. https://doi.org/10.35334/hw800s53

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