Leverage and Sales Growth on Firm Value with Profitability as a Mediatiating Variable
Abstract
This study aims to examine and analyze the effect of leverage and sales growth on firm value, with profitability as a mediating variable. The sample of this study consists of 75 consumer non-cyclicals sector companies listed on the Indonesia Stock Exchange for the 2023–2025 period, resulting 225 total observations. The method used in this study is an associative quantitative approach with path analysis using SPSS software. The results show that leverage has a positive and significant effect on both firm value and profitability. Conversely, sales growth does not show a significant effect on profitability or firm value. Profitability has a positive and significant effect on firm value. Furthermore, profitability is able to mediate the relationship between leverage and firm value, but it is unable to mediate the relationship between sales growth and firm value. These findings indicate that profitability plays an important role in increasing firm value, particularly in the context of a company’s capital structure.
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