Examining the Impact of Goodwill, Liabilities, and Stock Prices: A Study of Food and Beverage Subsector Companies Listed on the Indonesia Stock Exchange (IDX) in 2020-2021
Keywords:
Goodwill, Liabilities, Stock PricesAbstract
This study investigates the impact of reported Goodwill and Liabilities in the financial statements of companies listed on the Indonesia Stock Exchange (IDX) within the food and beverage sector on stock prices. Our analysis reveals that Goodwill exerts a significant positive influence on stock prices. Goodwill, as reflected in financial statements, represents the additional value of intangible assets such as reputation, brand strength, customer relationships, and future growth potential. Investors perceive Goodwill as a catalyst for company growth, bolstering confidence in the company's prospects and ultimately driving up stock demand and prices. Interestingly, our findings also indicate that reported Liabilities in financial statements have a positive impact on stock prices, contrary to conventional wisdom where Liabilities typically have a negative effect. The utilization of liabilities can lead to financial leverage, enhancing returns for shareholders and enabling companies to pursue more aggressive investments and expansions, thereby increasing attractiveness to investors. However, while the regression coefficient for Liabilities is positively valued, its impact on stock prices is not statistically significant at a 5% significance level. Nonetheless, there are indications that an increase in Liabilities can still contribute positively to stock prices, albeit to a lesser extent compared to Goodwill. These findings provide valuable insights for investors, market participants, and decision-makers in understanding the determinants of company stock prices in the food and beverage sector of the IDX. They underscore the importance of Goodwill in shaping positive investor perceptions of growth and company prospects, while also hinting at the potential positive influence of Liabilities, which warrants further exploration in future research endeavors.
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