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The Influence of Dividend Payments, Profitability, Liquidity and Firm Size for Cash Holdings ? Case of Indonesian Manufacturing Companies

Author

Listed:
  • Heru Fahlevi

    () (Syiah Kuala University)

  • Muhammad Arfan

    () (Syiah Kuala University)

  • Hafidah Hafidah

    () (Syiah Kuala University)

Abstract

This study is aimed at examining the influence of dividend payments, profitability, liquidity, and firm size for cash holdings in manufacturing companies. The population of this study was manufacturing companies listed in Indonesia Stock Exchange between 2010 and 2014. The population of this study was manufacturing companies that listed in Indonesia Stock Exchange which published financial statements by December 31st and paying dividend payments respectively during the observation period (2010-2014). This study used census method and collected cross-sections data. Thus, 32 companies were selected or 160 observation data were analysed. The data was collected from published financial statements. The analysis method used in this study was multiple linear regression. This study found that dividend payments, profitability, liquidity, and firm size both collectively and individually have an effect on cash holdings in the manufacturing companies. Therefore, the results are consistent with previous research findings, although it was carry out in a single industry and in a developing country.

Suggested Citation

  • Heru Fahlevi & Muhammad Arfan & Hafidah Hafidah, 2016. "The Influence of Dividend Payments, Profitability, Liquidity and Firm Size for Cash Holdings ? Case of Indonesian Manufacturing Companies," Proceedings of International Academic Conferences 4106579, International Institute of Social and Economic Sciences.
  • Handle: RePEc:sek:iacpro:4106579
    as

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    File URL: http://iises.net/proceedings/25th-international-academic-conference-oecd-paris/table-of-content/detail?cid=41&iid=021&rid=6579
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    References listed on IDEAS

    as
    1. Edith Ginglinger & Khaoula Saddour, 2007. "Cash holdings, corporate governance and financial constraints," Post-Print halshs-00162411, HAL.
    2. Ozkan, Aydin & Ozkan, Neslihan, 2004. "Corporate cash holdings: An empirical investigation of UK companies," Journal of Banking & Finance, Elsevier, vol. 28(9), pages 2103-2134, September.
    3. repec:dau:papers:123456789/2938 is not listed on IDEAS
    4. Opler, Tim & Pinkowitz, Lee & Stulz, Rene & Williamson, Rohan, 1999. "The determinants and implications of corporate cash holdings," Journal of Financial Economics, Elsevier, vol. 52(1), pages 3-46, April.
    5. Al-Najjar, Basil, 2013. "The financial determinants of corporate cash holdings: Evidence from some emerging markets," International Business Review, Elsevier, vol. 22(1), pages 77-88.
    6. Arslan, Ozgur & Florackis, Chrisostomos & Ozkan, Aydin, 2006. "The role of cash holdings in reducing investment-cash flow sensitivity: Evidence from a financial crisis period in an emerging market," Emerging Markets Review, Elsevier, vol. 7(4), pages 320-338, December.
    7. Miguel A. Ferreira & Antonio S. Vilela, 2004. "Why Do Firms Hold Cash? Evidence from EMU Countries," European Financial Management, European Financial Management Association, vol. 10(2), pages 295-319.
    8. Lee, Bong Soo & Suh, Jungwon, 2011. "Cash holdings and share repurchases: International evidence," Journal of Corporate Finance, Elsevier, vol. 17(5), pages 1306-1329.
    9. Wolfgang Drobetz & Matthias GrĂ¼ninger, 2007. "Corporate cash holdings: Evidence from Switzerland," Financial Markets and Portfolio Management, Springer;Swiss Society for Financial Market Research, vol. 21(3), pages 293-324, September.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Dividend Payments; Profitability; Liquidity; Firm Size; Cash Holdings;

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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