Author(s): Mohammad Al-Dwiry, Tariq Al-Basha, Weaam Amira
Tobin’s Q Ratio, as a measurement and valuation tool for companies, has been used extensively under different settings. This research study combines two multiple regression models used in a different settings in both Indonesia and Iran to investigate the relationship between the firm’s value, represented by Tobin’s Q ratio, as a dependent variable and total assets, return on assets, debt ratio and free cash flow as independent variables. The study selects the listed companies under the mining and extraction sector in Amman Stock Exchange. The range of the data collected is between 2005 to 2020 and Microsoft Excel is used to analyze the data through it to obtain the statistical description, Pearson Correlation Coefficient and Multiple Regression results. The study concludes that there is a significant and positive relationship between the firm’s value and its return on assets. Moreover, there is a moderate and positive relationship between the firm’s value and its free cash flow and total assets, inverse and moderate relationship between firm’s value and its debt ratio.