"THE EFFECT OF LEVERAGE ON CORPORATE VALUES THROUGH PROFITABILITY AS AN INTERVENING VARIABLES” (Case study on Telecommunication companies listed on IDX 2013-2017)

Abstract

This study aims to determine the effect of Debt to Equity Ratio (DER), Degree
Financial Leverage (DFL) and Degree Operating Leverage (DOL) on firm value. Effect of Debt to
Equity Ratio (DER), Degree Financial Leverage (DFL) and Degree Operating Leverage (DOL)
on profitability. Effect of Debt to Equity Ratio (DER), Degree Financial Leverage (DFL) and
Degree Operating Leverage (DOL) simultaneously on profitability. And to determine the effect of
Debt to Equity Ratio (DER), Degree Financial Leverage (DFL) and Degree Operating Leverage
(DOL) on the value of the company with profitability as an intervening variable.
In this study using quantitative methods. Data analysis techniques in quantitative
research using statistics, namely descriptive statistics. The results of this study indicate that DER
has a significant effect on firm value. DFL and DOL have no significant effect on firm value. ROA
affects and significantly affects the value of the company. DER has no effect on ROA but has a
significant effect. Then DFL & DOL has no significant effect on ROA. DER, DFL & DOL
simultaneously have a significant and positive effect on ROA. DER & DFL through ROA has a
direct and significant influence on company value. And DOL through ROA on company value has
an indirect and significant influence on firm value.
Keywords: Leverage Ratio, Profitability (Return On Assets), and company value