The Effect of Earnings Persistence and Capital Structure on Earnings Response Coefficient in Indonesia Stock Exchange
Journal Title: Journal of Economics, Finance and Management Studies - Year 2024, Vol 7, Issue 03
Abstract
This study managed to investigate the effect of earnings persistence and leverage on the Earnings Response Coefficient (ERC) in companies listed on the Indonesia Stock Exchange. Based on the annual report data of 265 companies from 2011 to 2021, we show that earnings persistence has a significant and positive impact on ERC, while leverage has a limited impact on ERC. Further findings demonstrate that higher investor sentiment could lead to a larger impact of earnings persistence on ERC. These results imply that, as high earning quality Attracts high investor sentiment in the trading stock, great news can be processed into the price quickly and the price rises in a short period, while bad news could also lead to immediate price corrections with investors’ attention. Thus, we find that a positive relationship between ROE and ERC, and investor sentiment helps strengthen the relationship. Our study adds the studies on price resilience and expands the understanding of the Indonesia Stock Exchange’s features.
Authors and Affiliations
Rehuel Murlie Sandy , Ali Sandy Mulya
Keywords
Related Articles
- EP ID EP731634
- DOI 10.47191/jefms/v7-i3-04
- Views 64
- Downloads 0
Exploring the Opportunities and Challenges of Artificial Intelligence in Healthcare: A Study of Healthcare Workers in Medical Institutions in Akure, Ondo State, Nigeria
A total of 200 health care workers (32 medical doctor, 77 nurses, 46 allied health e.g., physiotherapy etc., 30 administrative officers, and 15 others hospital officers). Outcomes revealed that healthcare workers general...
The Effect of Knowledge Management System and Strategic Management Orientation on Organizational Tni Al Commitment in Ship Building Diving in the Land of Water Mediated by Dynamic Capabilities
The main objective of this study is to analyze the Knowledge Management System and Strategic Management Orientation on the Organizational Commitment of the Indonesian Navy in the Development of Submarines in the Country...
Influence of Human Capital and Self-Efficacy in Improving Productivity of Power Plant Perators at Jeneponto Power Plant Through Knowledge Sharing
Research related to productivity improvement through the knowledge sharing process is still limited, so this research aims to find a model of productivity improvement through the utilization of knowledge sharing that can...
Using Econometrical Models to Analyze the Consumption Pattern of the Iraqi Individual for the Period 2004-2021
Studying Iraqi consumer behavior and analyzing its consumption pattern provides an excellent opportunity to reach logical and more accurate results. In particular, we are looking for the consumption pattern when the Iraq...
Who is The Most Popular Presidential Candidate in Indonesia Election Based on Google Trend
Social media plays a significant role in contemporary political marketing. Social media channels provide legislators and party officials a direct avenue to engage with individuals, allowing for efficient communication, c...