THE EFFECT OF CAPITAL STRUCTURE, PROFITABILITY, AND LIQUIDITY ON THE FINANCIAL PERFORMANCE OF COMPANIES IN THE PROPERTY AND REAL ESTATE SECTOR ON THE INDONESIAN STOCK EXCHANGE

Abstract

This study aims to analyze the effect of capital structure, profitability, and liquidity on the financial performance of property and real estate companies listed on the Indonesia Stock Exchange for the period 2021–2024. The study uses a quantitative approach with a causal associative method and secondary data in the form of quarterly financial reports. The analysis was conducted using panel data regression with EViews 13. The results show that, partially, capital structure, measured by the Debt-to-Equity Ratio, and profitability, measured by Return on Assets, have a significant positive effect on financial performance. Conversely, liquidity measured by the Current Ratio has no significant effect. Simultaneously, all three variables significantly affect companies’ financial performance. These findings indicate that capital structure management and increased profitability are the main factors in strengthening the financial performance of property companies, while liquidity is not a key indicator given the industry’s long-term project cycles.