Financial Distress Prediction Models in Property Sector Companies Listed in Indonesia Stock Exchange

Herlina, Meita Tri and Murhadi, Werner Ria (2020) Financial Distress Prediction Models in Property Sector Companies Listed in Indonesia Stock Exchange. In: The International Conference on Business and Engineering Management, February 01st, 2020, Surabaya. (Submitted)

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Abstract3⁄4 Along with the unstable national and global economic conditions, investors and consumers defend themselves to invest in the property sector. Companies go public in obtaining capital markets as a means to obtain sources of funds. Investors and creditors will see the financial condition required before the company will increase financial distress (financial distress) or not before investing their capital. Therefore, analysis and prediction of a company's financial problems is very important. This study uses the Financial Distress model by using discriminant analysis. The independent variables used are financial ratios which are divided into 4 categories (1) Liquidity Ratios, (2) Solvency Ratios, (3) Activity Ratios, (4) Profitability Ratios. This research uses quantitative with the Multivariate Discriminant Analysis (MDA) model. The sample data used in this study includes property, real estate, and construction sector companies listed on the Indonesia Stock Exchange in the 2014-2018 period. This study produces a financial distress model Z-score = -3,569 + 6,910DTA - 1.107DTE + 7,515ROE + 3,573OPM with a cut-off value of - 3,521. When the z-score of the company <-3,521 then the company is included in the group that changes financial difficulties, conversely if the z-score of the company> -3,521, the company is included in the non-financial pressure group.

Item Type: Conference or Workshop Item (Paper)
Uncontrolled Keywords: Multiple Discriminant Analysis (MDA),Financial Distress, Property Sector
Subjects: H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Divisions: Postgraduate Programs > Master Program in Management
Depositing User: Ester Sri W. 196039
Date Deposited: 08 Jan 2020 02:23
Last Modified: 08 Jan 2020 02:23

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