The Effect of Current Ratio, Debt to Equity Ratio and Return on Asset on Dividend Payout Ratio in Sub-sector Automotive and Component Listed in Indonesia Stock Exchange in Period 2012–2016
Abstract
The aim of this research was to find the effect of current ratio, debt to equity ratio, and return on asset on dividend payout ratio in subsector automotive and component-listed Indonesia Stock Exchange in the period 2012–2016. The sample selection in this research is done using purposive sampling method and six companies that matched the criteria were chosen. The research data is obtained from Indonesia Stock Exchange. The method used in this research is panel data regression analysis, and it was found that the more appropriate model to be used is a random effect. From the result of research got a value of adjusted R-Square equal to 68.69%. The result shows that debt to equity ratio and return on asset have a significant effect on dividend payout ratio with a regression coefficient equal to –0.065189 and 0.679691. However, the result of current ratio has no significant effect on the dividend payout ratio with a regression coefficient of 0.037200.
Keywords: dividend payout ratio, current ratio, debt to equity ratio, return on asset, automotive industry
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