Profitability, Debt Policy, and Firm Value: Dividend Policy as Mediating Variable in Consumer Non-Cyclicals Sector

Abstract

This research investigates dividend policy's mediating role in the relationship between profitability and firm value within Indonesia's consumer non-cyclicals sector. Utilizing panel data from 21 companies listed on the Indonesia Stock Exchange between 2019-2023, the study employs WarpPLS version 8.0 for Structural Equation Modeling analysis. The results show that profitability greatly increases the value of a company, that debt policy has a positive effect on the value of a company, and that dividend policy is a good way to connect profitability and company value. The results demonstrate the strategic relevance of dividend distribution decisions in translating operational performance into shareholder value creation, particularly within stable-demand consumer goods companies.