Investment Decisions, Debt Policy, and Dividend Policy Effects on Firm Value in Indonesian Banking Companies

Abstract

This research investigates how Price to Earnings Ratio (PER), Debt to Equity Ratio (DER), and Dividend Payout Ratio (DPR) influence firm value measured through Tobin's Q in banking institutions listed on the Indonesia Stock Exchange during 2020–2023. Utilizing quantitative methodology with secondary data from audited financial statements, findings demonstrate PER exerts significant positive influence on firm value, while DPR exhibits significant negative impact. DER shows no significant effect. Results support signaling and trade-off theories in financial decision-making contexts. These insights benefit corporate managers in strategic financial planning and assist investors in evaluating firm performance.