High Earnings Per Share Linked to Increased Firm Profitability and Value.
The study looked at how Earnings Per Share affects Price to Book Value, with Firm Size playing a role. They analyzed data from 36 public companies in Indonesia from 2017-2019. The results showed that Earnings Per Share has a significant impact on both Price to Book Value and Firm Size. A higher Earnings Per Share leads to a higher Price to Book Value, indicating better profitability. Firm Size also plays a role in this relationship, acting as a partial mediator. In simple terms, when a company's earnings are high, its value on the stock market tends to be higher, and the company's size influences this relationship.