The Effect of Return on Equity and Earning Per Share on Stock Prices Period 2011 – 2017 (Case Study: Adaro Energy, Tbk.)

Khayatun Nufus, Awaluddin Muchtar, Rizka Melia Utami


The purpose of this study is to know the Return On Equity (ROE), Earning Per Share (EPS) and the Share Price of PT. Adaro Energy, Tbk. and to determine the effect of Return On Equity (ROE), Earning Per Share (EPS) both partially and simultaneously on the stock price of PT. Adaro Energy, Tbk.  2011 – 2017 period.  This study uses secondary data, namely data taken indirectly from the source. The research method uses a quantitative descriptive approach and tests the classical assumptions which include, normality test, multicollinearity test, autocorrelation test, heteroscedasticity test, and data analysis including simple linear regression, multiple linear regression, test coefficient of determination, and hypothesis test (t and F) .

The partial test results (t test) for the ROE variable on stock prices obtained thitung = 2.522 <2.570 with a significant 0.053> 0.05 which means that Ho is accepted and H1 is rejected where ROE does not have a significant effect on stock prices, while for EPS variables on stock prices obtained thitung 4.316> 2.570 with a significance of 0.008 <0.05, which means that Ho is rejected and H2 is accepted where EPS has a significant influence on the Stock Price. Simultaneous tests (Test F) obtained Fcount 9,430> 6,94 with a significance number of 0,031 <0,05, which means that Ho is rejected and H3 is accepted where there is a significant effect between ROE and EPS simultaneously on Stock Prices. The Coefficient of Determination (KD) is indicated by the number 0.825 which concludes that ROE and EPS contribute 82.5% to the Stock Price, while the remaining 17.5% is influenced by other variables not examined.

Keywords: Return On Equity (ROE), Earning Per Share (EPS), and Stock Price.

DOI: 10.7176/RJFA/10-10-14

Publication date:May 31st 2019

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