Academy of Strategic Management Journal (Print ISSN: 1544-1458; Online ISSN: 1939-6104)

Research Article: 2021 Vol: 20 Issue: 3

The Effect of Profitability and Sales Growth on Stock Price: The Mediating Role of Capital Structure

Yeye Susilowati, Stikubank University Lie Liana, Stikubank University

Rahardwiyan Aristya Putra, Graduate Student of MMBL Binus Business School

Rofi Febriana, Graduate Student of MM Stikubank University


This research aims to analyze the effect of profitability and sales growth on stock price by considering capital structure as a mediation variable. This research used 82 companies listed in LQ45 between 2015 and 2019 as the sample. The data analysis employed the multiple linear regression method, and the Sobel test was utilized to test the mediation effect. The results revealed that profitability positively and significantly influenced the capital structure and stock prices. In addition, sales growth positively and significantly influenced stock prices but negatively and significantly affected stock prices. This research has proven that capital structure mediated the influence of profitability and sales growth on stock prices.

Keywords: Profitability, Sales Growth, Capital Structure, Stock Prices.

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