Analysis of The Effect of Economic Value Added and Market Value Added on Stock Return on The Indonesian Stock Exchange Case Study on Health Companies in 2019-2020

Abstract

The emergence of the Covid-19 pandemic at the beginning of 2020 in Indonesia certainly had a very significant impact and change, especially the lifestyle and habits of people's lives. On the other hand, this pandemic provides opportunities for health companies to provide goods and services that are basic needs during the pandemic. Based on this incident, of course, investors will look to invest some of their funds in these companies. However, before investing, investors must pay attention to the addition or subtraction of the actual value of the company's real condition. Therefore, this study tries to analyze the company's performance using the Economic Value Added (EVA) and Market Value Added (MVA) methods which can become a reference for investors before investing. The purpose of this study is to determine the effect of EVA, MVA, and both on stock returns. The method used is a quantitative approach with descriptive and verification analysis methods. The data used in this study is secondary data from the company's financial statements. The samples analyzed were 16 health sector companies listed on the Indonesia Stock Exchange, the selection of this sample used a non-probability sampling method with purposive sampling technique. The results obtained from this study, namely: EVA has a negative effect on stock returns, MVA has a negative effect on stock returns, and both (EVA + MVA) simultaneously have a negative effect on stock returns. Based on the hypothesis test with Simultaneous Test (F-test) the F count value is 0.0099 with F table value 4.17 (F count < F table), meaning that all independent variables (EVA and MVA) have insignificant effect on stock returns. Hypothesis test with partial test (T test) shows for EVA obtained T count 0.0785 and T table value 2.04 (F count < F table) which means EVA has no effect on stock returns, while for MVA, the T count is 0.1460 and the T table value is 2.04 (F count < F table) which means that MVA also has insignificant effect on stock return prices.