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970
Journal Of Economics, Technology, and Business (JETBIS)
Volume 3, Number 7 July 2024
p-ISSN 2964-903X; e-ISSN 2962-9330
THE EFFECT OF CURRENT RATIO (CR) AND NET PROFIT MARGIN (NPM)
ON STOCK PRICE (CASE STUDY OF AUTOMOTIVE SUBSECTOR
MANUFACTURING COMPANIES LISTED ON THE IDX IN 2020-2022)
Naellus Sa’adah
1
, Wulan Alayda
2
, Acep Komara
3
Universitas Swadaya Gunung Jati, Cirebon, Indonesia
Email: [email protected]
1
2
3
KEYWORDS:
Current Ratio (CR), Net
Profit Margin (NPM),
Share Price
ABSTRACT
A profitable company's stock price will rise, and vice versa. The stock
market price reflects the state of the business. Fundamental analysis
is one kind of analysis that is done to understand how stock prices are
formed. The purpose of this study is to analyze the factors that affect
stock prices. In this study, the internal factors used are the Current
Ratio (CR) and Net Profit Margin (NPM). Secondary data for this
study comes from the annual or annual financial statements of
companies listed on the Indonesia Stock Exchange (IDX) for the
automotive manufacturing subsector from 2020 to 2022. The
sampling method is purposive, which means that the sample is
selected non-randomly, and adjusted to the problem or research
objectives. This study uses secondary data in the form of annual
financial reports totaling 11 samples from automotive subsector
manufacturing companies listed on the IDX for the 2020-2022 period.
The results showed that the Current Ratio (CR) regression coefficient
value was -0.011. This shows that the Current Ratio variable has a
negative and significant effect on stock prices. Net Profit Margin
(NPM) of 0.522 indicates that the Net Profit Margin variable has a
positive and significant effect on stock prices.
INTRODUCTION
The realm of business and industry is now seeing a significant surge in expansion due to
the modern age of globalization. The rise of novel commercial and industrial sectors motivates
firms to enhance their operational efficiency and discernment to attain their objective of
maximizing revenues. The current performance of the firm will have a significant impact on
future decision-making. However, for investors, profitability is the primary criterion that
defines the investmentworthiness of a firm. To make informed investment decisions, investors
must thoroughly evaluate all aspects of the company's performance. The capital market, usually
referred to as the Indonesia Stock Exchange (IDX), provides investors with the chance to invest
in equities. A primary factor that investors often evaluate when making investments is the
financial success of a firm. Generally, when a company's financial performance improves, there
is often a corresponding rise in demand for the company's shares (Priyowidodo, 2023).
Financial statements include a balance sheet, income statement, and other financial
statements. If the balance sheet, income statement, or cash flow statement fails to provide
maximum advantages for the user, the user should contemplate using financial statement
analysis techniques such as ratio analysis. This analysis encompasses several aspects such as
solvency, liquidity, profitability, leverage, and activity or productivity. Calculating the
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The Effect Of Current Ratio (CR) And Net Profit Margin (NPM)
On Stock Price (Case Study Of Automotive Subsector
Manufacturing Companies Listed On The Idx In 2020-2022)
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financial ratios of a corporation is a straightforward operation in financial analysis. Instead of
doing computations, the focus is on analyzing and interpreting the resulting ratios. Ratio
analysis is a commonly used method for making informed judgments on investments, stock
acquisitions, or credit evaluations (Faridatul & Sunandar, 2021)
The share price reflects the performance of the issuer and its movement correlates with
the performance of the issuer. As the issuer's performance improves, the potential earnings
from the company's activities also grow. Investors should be aware of this crucial aspect of
capital market activity while making investing decisions.
The stock market price reflects the state of the firm. As stated by Sunariyah (2020), the
stock price of a successful firm will rise, while on the contrary, it would decrease for an
unprofitable company. One method used to elucidate the development of stock prices is
fundamental analysis. This study is predicated on the notion that the fundamental assessment
of the firm has an impact on the stock price.
Essentially, a company's ability to generate profits directly influences the demand for its
shares, leading to an upward movement in its share price. The stock market price reflects the
effectiveness of the company's management. Hence, the valuation of a corporation may be
shown by its share price in the capital market. By doing an analysis of liquidity, solvency,
profitability, leverage, and productivity or activity, it is possible to identify several elements
that have an impact on stock prices. The internal parameters used in this analysis were the
Current Ratio (CR) and Net Profit Margin (NPM) (Satria, 2022).
The Current statistic (CR) is a financial statistic that assesses a company's capacity to
settle its immediate debts by using its existing current assets. A larger ratio indicates that the
organization has a superior capacity to settle its short-term debts. However, an excessively high
ratio may also suggest inadequate management of liquidity sources. Utilize the earnings
derived from existing assets to distribute dividends, settle long-term debts, or engage in
investments that provide higher returns (Gill & Clanton, 2008 in (Rahayu et al., 2020). In order
to determine the current ratio, it is necessary to take into account several factors that influence
the company's performance, including the industrial sector, management strategies, and
macroeconomic conditions.
The Net Profit Margin (NPM) is a financial ratio that measures the profitability of a
company by comparing its net profit after tax (NIAT) to its sales revenue. It indicates the
amount of net profit generated per unit of sales. An elevation in net profit margin (NPM)
signifies a corresponding enhancement in both the overall performance of the firm and the
returns received by its shareholders (Suryana & Widjaja, 2019).
In a study done by (Faridatul & Sunandar, 2021), it was shown that CR and DER have a
significant impact on stock prices, whereas DER and NPM do not. Recent research conducted
by (Triyonowati, 2023) demonstrates that both corporate reputation (CR) and new product
marketing (NPM) have a significant influence on stock prices. However, it is worth noting that
the study did not find any substantial impact of debt-to-equity ratio (DER) on stock prices. A
study done by (Rahayu et al., 2020) examined the influence of CR, NPM, and NPL on stock
prices. The findings revealed that CR and NPL have a substantial effect on stock prices,
however NPM did not. A study done by (Suryana & Widjaja, 2019) revealed that the factors
of CR and DER did not have a substantial influence, however, NPM had a considerable effect.
The Effect Of Current Ratio (CR) And Net Profit Margin (NPM)
On Stock Price (Case Study Of Automotive Subsector
Manufacturing Companies Listed On The Idx In 2020-2022)
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Prior research indicates a robust correlation between financial parameters and stock
prices. Financial ratios, which involve comparing accounts in financial statements, are
anticipated to serve as indicators for stock values. By using the data provided in the financial
accounts, anyone may evaluate the effectiveness of the company's management, which
ultimately leads to variations in the stock price.
Nevertheless, due to discrepancies in the results of other studies, the authors want to
undertake research on investment decision-making. This study will focus on the consideration
of many variables pertaining to the financial performance shown in a company's financial
statements. The study is named "The Impact of Current Ratio (CR) and Net Profit Margin
(NPM) on Share Price (A Case Study of Automotive Subsector Manufacturing Companies
Listed on the Indonesia Stock Exchange). ((IDX) 2020-2022).”
Financial Ratio
Financial ratio analysis involves comparing the figures in financial statements using a
standardized formula that is regarded to be representative. Financial ratios are quantitative
measures derived by comparing certain items in financial statements to other variables that
have a meaningful and substantial correlation (Puspitasari & Yahya, 2020)
a. Shares
Because they offer alluring returns, stocks are one of the most sought-after capital
market instruments for investors. Because they can generate lucrative rewards, stocks are
one type of capital market tool that can attract investors. A stock is a symbol of unilateral
or one-sided equity ownership (by a corporate entity) in a corporation. Shares are securities
that serve as a symbol of ownership in a corporation (Triyonowati, 2023).
b. Financial Report
(Mulatsih & Dewi, 2021) state that financial statements serve the purpose of
conveying information regarding a company's financial status, performance, and alterations
to individuals involved in making economic choices. In addition, they evaluate the
company's capacity to generate and effectively measure its liquidity and cash equivalents.
c. Current Ratio (CR)
The current ratio measures a company's ability to fulfill its obligations without
having to sell off its assets or excessively depend on its current assets. The current ratio
measures the degree of protection for short-term creditors or the company's capacity to
settle its debts. Nevertheless, organizations with a high current ratio do not necessarily
ensure the repayment of debt due to the unfavorable distribution or proportion of current
assets (Khairani et al., 2020). The formula for the current ratio, as stated by (Chandra &
Veronica, 2018), is:
𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑅𝑎𝑡𝑖𝑜 =
𝑐𝑢𝑟𝑟𝑒𝑛𝑡 𝑎𝑠𝑠𝑒𝑡𝑠
𝑐𝑢𝑟𝑟𝑒𝑛𝑡 𝑑𝑒𝑏𝑡
𝑥 100%
d. Net Profit Margin (NPM)
The net profit margin is a financial ratio that measures the efficiency of a business in
generating net profit after tax. The ratio can be determined by dividing the total sales by
the net profit after tax. This is a research tool that can demonstrate profitability. A larger
Net Profit Margin (NPM) figure signifies strong production performance and has the
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The Effect Of Current Ratio (CR) And Net Profit Margin (NPM)
On Stock Price (Case Study Of Automotive Subsector
Manufacturing Companies Listed On The Idx In 2020-2022)
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potential to enhance investor confidence, leading to an increase in share prices. This ratio
can also be utilized to compute the magnitude of profit generated from sales (Andhani,
2019). The calculation of the net profit margin, as described by (Ramadhany et al., 2017),
is as follows:
𝑁𝑒𝑡 𝑃𝑟𝑜𝑓𝑖𝑡 𝑀𝑎𝑟𝑔𝑖𝑛 =
𝑝𝑟𝑜𝑓𝑖𝑡 𝑎𝑓𝑡𝑒𝑟 𝑡𝑎𝑥
𝑆𝑎𝑙𝑒𝑠
𝑥 100%
RESEARCH METHODS
Population
The population for this study consisted of 12 automotive sub-sector manufacturing
companies that were either listed or publicly traded on the Indonesia Stock Exchange (IDX)
from 2020 to the end of 2022. The sampling method is purposive, which means that the sample is
selected non-randomly, and adjusted to the problem or research objectives (Sugiyono, 2013).
Table 1
Population
No.
Company Code
Company Name
1.
ASII
Astra International Tbk
2.
AUTO
Astra Otoparts Tbk
3.
BOLT
Garuda Metalindo Tbk
4.
BRAM
Indo Kordsa Tbk
5.
GDYR
Goodyear Indonesia Tbk
6.
GJTL
Gajah Tunggal Tbk
7.
IMAS
Indomobil Sukses Internasional Tbk
8.
INDS
Indospring Tbk
9.
LPIN
Multi Prima Sejahtera Tbk
10.
MASA
Multistrada Arah Sarana Tbk
11.
PRAS
Prima Alloy Steel Universal Tbk
12.
SMSM
Selamat Sempurna Tbk
Source: www.idx.co.id
A sample refers to a portion of the population that is selected using a certain procedure.
The study employed a purposive sampling technique, whereby the sample was intentionally
chosen based on the specific objectives and issues at hand. The criteria for sampling are:
a.
Automotive manufacturing businesses in the sub-sector that are publicly traded on the
Indonesia Stock Exchange (IDX) continuously for the years 2020, 2021, and 2022.
b.
The manufacturing companies' annual financial statements, denominated in Rupiah, for the
years ending on December 31, 2020, 2021, and 2022.
c.
The financial statements of the manufacturing company are in a positive profit condition.
d.
Publishing audited financial statements for the observation period of 2020-2022,
accompanied by an independent auditor's report on the company's financial accounts.
Sample
Table 2
Sample Selection
No
Description
Total
The Effect Of Current Ratio (CR) And Net Profit Margin (NPM)
On Stock Price (Case Study Of Automotive Subsector
Manufacturing Companies Listed On The Idx In 2020-2022)
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RESULTS AND DISCUSSION
Descriptive Analysis
Table 3
Descriptive Analysis
Descriptive Statistics
N
Minimum
Maximum
Mean
Std. Deviation
CR
33
.00
.99
.1021
.16970
NPM
33
1.57
2.24
1.9636
.16099
Share Price
33
122.00
12325.00
2369.3030
2739.6191
Valid N (listwise)
33
Source: Data processed by researchers, 2024
The average Current ratio (CR) value in automotive subsector manufacturing enterprises,
as shown in Table 3, is 0.1021. The firm with the lowest value is PT Indomobil Sukses
Internasional Tbk 2022, which has a value of 0.00. On the other hand, the company with the
highest value is PT Indo Kordsa Tbk 2021, which has a value of 0.99. The data has a standard
deviation of 0.16970.
The average Net Profit Margin (NPM) value in automotive subsector manufacturing
enterprises, as shown in Table 3, is 1.9636. PT Goodyear Indonesia Tbk 2022 has the lowest
1
Automotive sub-sector manufacturing companies that are listed
on the Indonesia Stock Exchange (IDX) consecutively for the
periods 2020, 2021, and 2022.
12
2
Annual financial statements of manufacturing companies not
published in Rupiah with a closing date of December 31 in 2020,
2021, and 2022.
0
3
The financial statements of the manufacturing company are not in
a positive profit condition
(1)
4
During the observation period from 2020 to 2022, the company
released financial statements that had not been audited. However,
there is an independent auditor's report available for the company's
financial statements.
0
Total
11
Periode 2020 – 2022
3
Number of samples
33
No.
Company Code
Sample Company Name
1.
ASII
Astra International Tbk
2.
AUTO
Astra Otoparts Tbk
3.
BRAM
Indo Kordsa Tbk
4.
GDYR
Goodyear Indonesia Tbk
5.
GJTL
Gajah Tunggal Tbk
6.
IMAS
Indomobil Sukses Internasional Tbk
7.
INDS
Indospring Tbk
8.
LPIN
Multi Prima Sejahtera Tbk
9.
MASA
Multistrada Arah Sarana Tbk
10.
PRAS
Prima Alloy Steel Universal Tbk
11.
SMSM
Selamat Sempurna Tbk
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value of 1.57, while PT Astra Internasional Tbk 2022 has the highest rating of 2.24. The data
has a standard deviation of 0.16099.
The average share price value in automotive subsector manufacturing companies, as
indicated in Table 3, is 2369.3030. The company with the lowest value is PT Prima Alloy Steel
Universal Tbk in 2020, valued at 122. On the other hand, the company with the highest value
is PT Indo Kordsa Tbk in 2021, valued at 12,325. The standard deviation is 2739.6191.
Classical Assumption Test
a. Normality Test
The normality test was assessed using the Kolmogorov-Smirnov statistical test in this
study. The Kolmogorov-Smirnov test is a statistical test employed to assess the normality
of data, as an alternative to graphical analysis. The decision-making process for the
Kolmogorov-Smirnov test determines whether the data is regularly distributed. If the
significance value returned from the first column of the SPSS output for the one-sample
Kolmogorov-Smirnov test is more than 0.05, it is considered to be normally distributed.
Table 4
One sample kolmogorov smirnov test
One-Sample Kolmogorov-Smirnov Test
Unstandardized Residual
N
33
Normal Parameters
a,b
Mean
-.0000006
Std. Deviation
.08452592
Most Extreme
Differences
Absolute
.133
Positive
.102
Negative
-.133
Test Statistic
.133
Asymp. Sig. (2-tailed)
.148
c
a. Test distribution is Normal.
b. Calculated from data.
c. Lilliefors Significance Correction.
Source: Data processed by researchers, 2024
Referring to Table 4, it is evident that the Asymp. Sig. (2-tailed) is more than the
significant value (0.148 > 0.05). Therefore, it can be inferred that the data in this study
exhibit a normal distribution.
a. Heteroscedasticity Test
The heteroscedasticity test is conducted to determine if there is a difference in variance
among the residuals of different observations in the regression model. Heteroscedasticity
can be detected by examining the scatterplot. If there is no discernible pattern and the data
points are scattered both above and below zero on the Y axis, then heteroscedasticity is
absent. (Ghozali, 2011).
The Effect Of Current Ratio (CR) And Net Profit Margin (NPM)
On Stock Price (Case Study Of Automotive Subsector
Manufacturing Companies Listed On The Idx In 2020-2022)
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Figure 2
Heteroscedasticity test
The scatterplot graphs X1 and X2 in Figure 2 indicate that the data does not exhibit a
discernible pattern. The dots are distributed both above and below zero on the Y-axis.
Therefore, it can be inferred that there is no heteroscedasticity present in the regression
model.
b. Multicollinearity Test
The multicollinearity test is conducted to determine if there is a correlation between the
independent variables in the regression model. To identify multicollinearity, one should
examine the tolerance value and the Variance Inflation Factor (VIF) value. These two
metrics indicate which independent factors are accounted for by other independent variables
(Ghozali, 2011).
Table 5
Multicollinearity test
Coefficients
a
Model
Unstandardized Coefficients
Collinearity Statistics
B
Std. Error
Tolerance
VIF
1
(Constant)
-.353
.010
CR
-.011
.005
.931
1.074
NPM
.522
.005
.931
1.074
a. Dependent Variable: Share Price
Source: Data processed by researchers, 2024
The results of the multicollinearity test in Table 5 indicate that certain independent
variables have a tolerance value below 0.10. Additionally, the Variance Inflation Factor
(VIF) calculation reveals that certain independent variables have a VIF value exceeding 10.
Therefore, it may be inferred that the proposed regression model equation exhibits
multicollinearity.
c. Autocorrelation Test
The autocorrelation test is conducted to see whether there is a link between residual
errors from the preceding period (t-1) in the regression model. To identify autocorrelation,
one can utilize the Lagrange Multiplier test (LM test), which yields Breusch-Godfrey
statistics (Ghozali, 2011).
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The Effect Of Current Ratio (CR) And Net Profit Margin (NPM)
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Table 6
Autocorrelation Test
Model Summary
b
Model
R
R Square
Adjusted R
Square
Std. Error of
the Estimate
Durbin-Watson
1
.999
a
.997
.997
.00461
1.362
a. Predictors: (Constant), NPM, CR
b. Dependent Variable: Share Price
Source: Data processed by researchers, 2024
The findings shown in Table 6 indicate that the Durbin-Watson (DW) value observed
in this investigation falls within the range of -2 to 2, specifically at a value of 1.362. It can
be inferred that the regression coefficient indicates the presence of autocorrelation disorder.
d. Multiple Linear Regression Test
Multiple linear regression analysis is employed to assess the collective impact of
independent factors on the dependent variable.
Table 7
Multiple linear regression test
Coefficients
a
Model
Unstandardized Coefficients
Standardized Coefficients
t
Sig.
B
Std. Error
Beta
1
(Constant)
-.353
.010
-33.693
.000
CR
-.011
.005
-.022
-2.163
.039
NPM
.522
.005
.993
99.610
.000
a. Dependent Variable: Share Price
Source: Data processed by researchers, 2024
Multiple linear regression analysis is employed to examine the collective impact of
independent factors on the dependent variable:
Y = -0.353 – 0.011X
1
+ 0.522X
2
Based on the regression equation above, it can be explained that:
1. The equation is characterized by a constant value of -0.353. The above value suggests that
when both the independent variables, current ratio, and net profit margin, are set to 0, the
stock price is -0.353.
2. The current ratio in this equation is -0.011. This number represents the relationship between
the current ratio and the stock price in this study. It suggests that if all other independent
variables remain constant, a one-time rise in the current ratio will result in a fall in the stock
price by 0.011 units.
3. The net profit margin value in this calculation is 0.522. This number represents the
relationship between the net profit margin and the stock price in this study. It suggests that
for every one-time rise in the net profit margin, holding all other independent variables
The Effect Of Current Ratio (CR) And Net Profit Margin (NPM)
On Stock Price (Case Study Of Automotive Subsector
Manufacturing Companies Listed On The Idx In 2020-2022)
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constant, the stock price will increase by 0.522.
Hypothesis testing
a. Partial test (t-test)
The t-statistical test shows how far the influence of one explanatory or independent
variable individually explains the variation in the dependent variable (Ghozali, 2011).
Table 8
Test t
Coefficients
a
Model
Unstandardized Coefficients
Standardized
Coefficients
t
Sig.
B
Std. Error
Beta
1
(Constant)
-.353
.010
-33.693
.000
CR
-.011
.005
-.022
-2.163
.039
NPM
.522
.005
.993
99.610
.000
a. Dependent Variable: Share Price
Source: Data processed by researchers, 2024
According to Table 8, the partial test or t-test indicates that:
1. The Impact of Current Ratio (CR) on Stock Price According to the t-test results, the
probability value of CR is 0.039, indicating that it is smaller than 0.05. Therefore, it may
be inferred that corporate responsibility (CR) has a detrimental and substantial impact on
stock prices, thereby confirming the acceptance of hypothesis Ha.
2. The impact of net profit margin (NPM) on the value of a company's shares. According to
the t-test results, the probability value of NPM is 0.000, indicating that it is smaller than
0.05. Therefore, it can be inferred that NPM has a favorable and substantial impact on
stock prices, leading to the acceptance of the alternative hypothesis (Ha).
b. Simultaneous Test (F test)
The F test is computed to assess the collective impact of all independent variables on
the dependent variable in the regression model. The concept of simultaneous hypothesis
testing is elucidated in the subsequent table:
Table 9
F test
ANOVA
a
Model
Sum of Squares
df
Mean Square
F
Sig.
1
Regression
.229
2
.114
5389.068
.000
b
Residual
.001
30
.000
Total
.229
32
a. Dependent Variable: Table 9 F test
b. Predictors: (Constant), NPM, CR
Source: Data processed by researchers, 2024
Referring to Table 9, the F value is 5389.068, and the F significance is 0.000 <0.05.
Therefore, we accept the alternative hypothesis (H1) and reject the null hypothesis (H0),
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indicating that the variables Current Ratio (CR) and Net Profit Margin (NPM) have a
simultaneous effect on the stock price variable.
c. Test Coefficient of Determination (R2)
The coefficient of determination quantifies the extent to which the model can account
for variations in the independent variable.
Table 10
R2 Test
Model Summary
b
Model
R
R Square
Adjusted R
Square
Std. Error of the
Estimate
1
.999
a
.997
.997
.00461
a. Predictors: (Constant), NPM, CR
b. Dependent Variable: Share Price
Source: Data processed by researchers, 2024
Table 10 The study yielded an adjusted R2 value of 0.997, which corresponds to a
percentage of 99.7%. This indicates that the stock price variable is mostly influenced by the
three independent variables: current ratio (CR) and net profit margin (NPM), which account
for 99.7% of the variation. The remaining 0.3% can be attributed to factors not considered
in this study.
Effect of Current Ratio (CR) on Stock Price
The results of hypothesis testing indicate that the probability value is less than the
significance value, specifically 0.039 < 0.05. Additionally, the regression coefficient value is -
0.011. These findings indicate that the current ratio variable has a noteworthy and adverse
impact on the stock price of automotive sub-sector manufacturing firms listed on the IDX
throughout the timeframe of 2020-2022. A high current ratio suggests inadequate liquidity
management since the surplus funds held by the corporation are not utilized for dividend
payments, short-term debt repayment, or other investments. This indicates that the organization
is experiencing poor cash flow and investment management. Consequently, investors' interest
in purchasing the company's shares diminishes, leading to a fall in the number of share requests.
This will lead to a decline in the company's stock price in the financial market. The findings of
this study are corroborated by the research carried out by Amrah & Elwisam (2019) and Lutfi
& Sunardi (2019). The results of these past studies indicate that the current ratio has a large
and negative impact on stock prices.
The Effect of Net Profit Margin (NPM) on Stock Price
The results of the hypothesis testing indicate that the probability value is less than the
significance value, which is 0.000 <0.05, and the regression coefficient value is 0.522. This
indicates that the net profit margin variable has a favorable and statistically significant impact
on the stock price of automotive sub-sector manufacturing companies that are listed on the
IDX throughout the period of 2020-2022. A high net profit margin (NPM) indicates strong
corporate performance as it signifies the ability to earn substantial net profit from sales
operations. This, in turn, increases investor demand for the firm's shares and leads to a rise in
the company's stock price. The findings of this study are corroborated by the research carried
The Effect Of Current Ratio (CR) And Net Profit Margin (NPM)
On Stock Price (Case Study Of Automotive Subsector
Manufacturing Companies Listed On The Idx In 2020-2022)
Vol 3, No 7 July 2024
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980
out by Nafis Dwi Kartiko (2021) and Eny Purwaningsih (2022). Previous research findings
indicate that the net profit margin has a favorable and statistically significant impact on stock
prices.
The Effect of Current Ratio (CR) and Net Profit Margin (NPM) on Stock Price
The results of hypothesis testing indicate that the probability value (F-statistic) is less
than the significance value, which is 0.000 < 0.05. Additionally, the Adjusted R-squared
coefficient of determination is 0.997, indicating that 99.7% of the variation in stock prices can
be explained by the current ratio and net profit margin. The remaining 0.3% is attributed to
other factors not included in the research variables. This demonstrates that both the current
ratio and net profit margin have a concurrent impact on the stock prices of automotive sub-
sector manufacturing companies listed on the IDX throughout the timeframe of 2020-2022.
The stock price is influenced by changes in both the current ratio and net profit margin.
CONCLUSION
Based on the panel data regression analysis, the findings indicate that the Current Ratio
has a negative and statistically significant impact on the Share Price of automotive sub-sector
manufacturing companies listed on the IDX during the period of 2020-2022. Additionally, the
Net Profit Margin has a positive and statistically significant effect on the Share Price of these
companies during the same period. The Current Ratio and Net Profit Margin both have a
positive and statistically significant impact on the Share Price of automotive subsector
manufacturing businesses listed on the IDX throughout the period of 2020-2022. Investors
seeking to predict share prices should consider many aspects that impact both internal and
external dynamics, such as capital, asset size, and other relevant variables. Companies must
carefully assess their debt policy, as higher levels of debt can decrease investor interest in
investing. For further research, it is recommended to add the variables studied and increase the
number of samples taken.
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