VALUE RELEVANCEOF EARNINGS PER SHARE AND BOOK VALUE OFEQUITY AMONG AUTOMOTIVE SUBSECTOR COMPANIES IN INDONESIA STOCK EXCHANGE (IDX)

Dewi Octavia A S P

Abstract


This study aims to analyze the influence of value relevance of earnings per
share and book value of equity to the stock price of Sub Sector Automotive &
Components companies listed on the Indonesia Stock Exchange. The population
in this study is Sub Sector Automotive & Components go public companies in
Indonesia Stock Exchange as many as 12 companies. The sampling was done
through purposive sampling method based on several considerations or criteria.
The criteria are the companies must be Sub Sector Automotive & Components
companies that have gone public and listed in IDX from 2011 until 2013. The data
in this study was analyzed using multiple regression
The results showed that earnings per share is relevant to measure firm
value. The book value of equity is relevant to measure firm value.Based on these
results, investor needs to consider the value of earnings per share and book value
of equity in making any investment decision because it is important to assess the
potential revenue to be accepted.

Keywords: Value Relevance of Accounting Information, Earnings Per Share, and  
Book Value of Equity

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