THE EFFECTS OF FINANCIAL DISTRESS, EARNINGS QUALITY, AND COMPANY SIZE ON COMPANY VALUE (A STUDY OF TELECOMMUNICATIONS COMPANIES LISTED ON THE IDX FROM 2020 TO 2023)

Abstract

This study aims to test and analyze the effect of financial distress—as proxied by the Altman Z-Score—earnings quality—as proxied by the ratio of operating cash flow to net income—and firm size—as proxied by total assets—on company value (Tobin’s Q). The population of this quantitative causal study consists of 21 telecommunications companies listed on the Indonesia Stock Exchange. From 15 selected companies, 60 data points were collected for the period 2020–2023 and analyzed using multiple linear regression in the Statistical Package for the Social Sciences (SPSS) version 27. This study found that financial distress, as measured by the Altman Z-Score, has a positive effect on firm value; that earnings quality, as measured by the ratio of operating cash flow to net income, has no significant effect on firm value; and that firm size, as measured by total assets, has no significant effect on firm value.