The Influence of Earnings Per Share and Dividend Per Share on Stock Prices in Plantation Companies Listed on the Indonesia Stock Exchange

Oct 13, 2025 by talynt.org 102 views

The Influence of Earnings Per Share and Dividend Per Share on Stock Prices in Plantation Companies Listed on the Indonesia Stock Exchange

Introduction

The Indonesia Stock Exchange (IDX) is one of the largest stock exchanges in Southeast Asia, with a wide range of companies listed across various sectors. Among these sectors, the plantation industry plays a significant role in the country's economy, with many companies listed on the IDX. The performance of these companies is often measured by their earnings per share (EPS) and dividend per share (DPS), which are critical indicators of a company's financial health and profitability. However, the relationship between EPS, DPS, and stock prices is complex and influenced by various factors.

This study aims to examine the effect of EPS and DPS on the stock prices of plantation companies listed on the IDX. The analysis will determine whether the growth of EPS and DPS has a significant effect on stock prices, both partially and simultaneously. The study will also explore the implications of these findings for investors, plantation companies, and capital market regulators.

Methodology

This study uses a causal approach involving eight plantation companies listed on the IDX during the 2008-2011 period. The purposive sampling method is used to select samples, and the data used is external data obtained from the 2011 Indonesian Capital Market Directory (ICMD) and the site www.idx.co.id. The data analysis process is carried out by conducting a classic assumption test first, then proceed with hypothesis testing using multiple linear regression methods.

Results

The results of this study show that both partially and simultaneously, EPS and DPS have a significant effect on the share price of plantation companies listed on the IDX. The magnitude of the effect of EPS and DPS on stock prices reached 81%, while the remaining 19% were influenced by other factors that were not discussed in this study.

Implications and Analysis

The results of this study provide some important implications for investors, plantation companies, and capital market regulators:

For Investors

This result shows that the growth of EPS and DPS is an important indicator in assessing the potential increase in the stock price of plantation companies. Investors can use this information to make more informed investment decisions.

For Plantation Companies

Companies can increase the value of the company and attract investors with a focus on increasing profit per share and dividend payments. This can be achieved through effective management strategies, operational efficiency, and sustainable business development.

For Capital Market Regulators

This result shows that regulations and transparency of company information are very important in supporting a healthy and efficient capital market. Strict regulations and accurate information can increase investor confidence and encourage capital market growth.

Other Factors Affecting Stock Prices

This study shows that 19% of the variation in stock prices is influenced by other factors outside EPS and DPS. These factors can include:

Macroeconomic Conditions

Global and domestic economic conditions, such as inflation rates, interest rates, and exchange rates, can affect company performance and investor sentiment.

Political and Social Factors

Political instability, natural disasters, and social issues can affect investor perceptions of investment risk in the plantation sector.

Industrial Factors

Technological development, changes in consumption trends, and competition between companies in the plantation sector can also affect stock prices.

The Importance of More In-Depth Analysis

This study only examines the effect of EPS and DPS on stock prices. To get a more comprehensive understanding, further research is needed that consider the other factors mentioned above. A deeper analysis will provide a more accurate picture of the dynamics of the stock price of plantation companies on the IDX.

Conclusion

Overall, this study shows that EPS and DPS are important factors that affect the stock price of plantation companies on the IDX. However, keep in mind that other factors also play a role in determining stock prices. Investors, companies, and capital market regulators need to consider these various factors to make appropriate decisions and support sustainable capital market growth.

Recommendations

Based on the findings of this study, the following recommendations are made:

Investors should consider the growth of EPS and DPS when making investment decisions.
Plantation companies should focus on increasing profit per share and dividend payments to attract investors and increase the value of the company.
Capital market regulators should ensure that regulations and transparency of company information are in place to support a healthy and efficient capital market.

Limitations of the Study

This study has some limitations that should be noted:

The study only examines the effect of EPS and DPS on stock prices and does not consider other factors that may influence stock prices.
The study uses a causal approach and may not capture the complexity of the relationship between EPS, DPS, and stock prices.
The study only examines the data from 2008-2011 and may not be representative of the current market conditions.

Future Research Directions

Based on the findings of this study, the following future research directions are suggested:

Further research should be conducted to examine the effect of other factors on stock prices, such as macroeconomic conditions, political and social factors, and industrial factors.
A more comprehensive analysis should be conducted to capture the complexity of the relationship between EPS, DPS, and stock prices.
The study should be replicated using more recent data to examine the current market conditions.

References

Indonesian Capital Market Directory (ICMD) (2011)
www.idx.co.id
Various academic journals and articles related to the topic.
Frequently Asked Questions (FAQs) about the Influence of Earnings Per Share and Dividend Per Share on Stock Prices in Plantation Companies Listed on the Indonesia Stock Exchange

Q: What is the main objective of this study?

A: The main objective of this study is to examine the effect of earnings per share (EPS) and dividend per share (DPS) on the stock prices of plantation companies listed on the Indonesia Stock Exchange (IDX).

Q: What is the significance of this study?

A: This study is significant because it provides insights into the relationship between EPS, DPS, and stock prices, which can help investors, plantation companies, and capital market regulators make informed decisions.

Q: What is the methodology used in this study?

A: This study uses a causal approach involving eight plantation companies listed on the IDX during the 2008-2011 period. The purposive sampling method is used to select samples, and the data used is external data obtained from the 2011 Indonesian Capital Market Directory (ICMD) and the site www.idx.co.id.

Q: What are the results of this study?

A: The results of this study show that both partially and simultaneously, EPS and DPS have a significant effect on the share price of plantation companies listed on the IDX. The magnitude of the effect of EPS and DPS on stock prices reached 81%, while the remaining 19% were influenced by other factors that were not discussed in this study.

Q: What are the implications of this study for investors?

A: The results of this study show that the growth of EPS and DPS is an important indicator in assessing the potential increase in the stock price of plantation companies. Investors can use this information to make more informed investment decisions.

Q: What are the implications of this study for plantation companies?

A: Companies can increase the value of the company and attract investors with a focus on increasing profit per share and dividend payments. This can be achieved through effective management strategies, operational efficiency, and sustainable business development.

Q: What are the implications of this study for capital market regulators?

A: This result shows that regulations and transparency of company information are very important in supporting a healthy and efficient capital market. Strict regulations and accurate information can increase investor confidence and encourage capital market growth.

Q: What are the limitations of this study?

A: This study has some limitations that should be noted:

The study only examines the effect of EPS and DPS on stock prices and does not consider other factors that may influence stock prices.
The study uses a causal approach and may not capture the complexity of the relationship between EPS, DPS, and stock prices.
The study only examines the data from 2008-2011 and may not be representative of the current market conditions.

Q: What are the future research directions?

A: Based on the findings of this study, the following future research directions are suggested:

Further research should be conducted to examine the effect of other factors on stock prices, such as macroeconomic conditions, political and social factors, and industrial factors.
A more comprehensive analysis should be conducted to capture the complexity of the relationship between EPS, DPS, and stock prices.
The study should be replicated using more recent data to examine the current market conditions.

Q: What are the recommendations of this study?

A: Based on the findings of this study, the following recommendations are made:

Investors should consider the growth of EPS and DPS when making investment decisions.
Plantation companies should focus on increasing profit per share and dividend payments to attract investors and increase the value of the company.
Capital market regulators should ensure that regulations and transparency of company information are in place to support a healthy and efficient capital market.

Q: What are the conclusions of this study?

A: Overall, this study shows that EPS and DPS are important factors that affect the stock price of plantation companies on the IDX. However, keep in mind that other factors also play a role in determining stock prices. Investors, companies, and capital market regulators need to consider these various factors to make appropriate decisions and support sustainable capital market growth.