THE EFFECT OF PROFITABILITY, COMPANY SIZE, DIVIDEND PAYOUT RATIO AND LEVERAGE ON GROWTH OF SHARES PRICE

Abstract

Companies that have good performance seen by its ability to generate profits, the company's value will increase. The value of the company is reflected in the company’s shares price. Company’s size also refers to company’s total assets. With the rising of the company’s assets, company’s ability to generating profit will increase which will make the company’s value increase. The investors will more concern to the dividend paid from one company in the present time rather than the profitable price volatility in the future time. The company can be say in their optimal level when the company can balance its advantage and disadvantage which are arise from the using of debt. Therefore, an optimal capital structure will increase the company’s value.