During the Joko Widodo administration in the 2014-2019 period, construction service providers received large-scale projects for infrastructure development such as government buildings, roads and other infrastructure. This has led to a drastic increase in the stock price of construction service companies. With this signal given, investors see this as an opportunity to get profit in investing. Several other factors that are considered by investors in investing, namely financial performance such as Earning per Share (EPS) and Economic Value Added (EVA). The purpose of this study is to determine the development of EPS, EVA and Stock Return, and to prove the effect of EPS and EVA on Stock Returns in BUMN construction service companies listed on the IDX in the 2014-2018 period either partially or simultaneously. This research uses descriptive quantitative method. The data used is secondary data from the financial statements of construction service companies on the IDX in the 2014-2018 period by collecting data through documentation studies and literature studies. The design of the hypothesis used is multiple regression analysis, correlation coefficient, determination coefficient, partial test and simultaneous test. The results of the research partially prove that EPS has a significant negative effect on Stock Returns, while EVA does not have a significant effect on Stock Returns. Simultaneously, EPS and EVA have a significant effect on Stock Return.

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The Influence of Earning Per Share (EPS) and Economic Value Added (EVA) on Wealth of Stock Holders at State-Own Construction Service Company Which Listed on IDX in 2014-2018 Period

The financial evaluation of the telecommunication industry is very important information not only in assessing financial performance but also as an input for successful strategic business planning either for the management of the company or for its share holders. The purpose of this research is to evaluate the financial performance using three measures which are the growth of Earning per Share (EPS), growth of Cash Flow Operation (CFO) and the growth of Economic Value Added (EVA) and their impact to the stock return. This research applied descriptive and statistic method. Statistical analysis applied the Multiple Linear Regression and Correlation Analysis. The test of the classical assumption such as the normality, autocorrelation, multicollinearity and heteroscedasticity applied before the linear regression. The purposive sampling method is used to obtain the sample and there are three telecommunication companies as our sample which are PT Telkom Tbk, PT Indosat Tbk, and PT. XL Axiata Tbk. The result showed that the growth of EPS, CFO and EVA tend to fluctuate during the research period of 2006-2010. The three variables effect significant and simultaneously to the stock return. But partially (a) EPS do not showed significant effect to the stock return, (b) CFO showed significant effect to the stock return (c) and EVA also showed significant effect to the stock return. Key word: Financial performance, EPS, CFO, EVA, stock return, telecommunication industry I. Research Background Financial crisis of 2008 in the economy of the US had influence many sectors of the world economy ever since. Financial market and stock exchange experience decreasing in the sales and price of many financial assets. At that time London stock exchange record decrease of 8% daily transaction, 7% decrease in Germany and 9% increase in France financial market. The same conditions also occurred in financial market in emerging market such as Rusia, Argentina and Brazil with 11% to 15% decrease. Chinese stock market decreased to 57%, India 52% and Indonesia 41% and European economy 37% decrease (Fossei: mail-archive.com). The financial crisis had gave large impact to the economy of Indonesia. The performance of the telecommunication industry is expected to slow due to the crisis. The crisis has limit the vendors of the telecommunication to exercise its role in domestic market (bisnisukm.com, 2009). 10th UBAYA INTERNATIONAL ANNUAL SYMPOSIUM ON MANAGEMENT ISBN: 978-979-99365-7-8 457 In 2008 the price stock of most telecommunication industries in indonesia decreased such as PT Telkom Tbk decrease to 32%, PT Indosat Tbk decrease to 33%, PT Excelcomindo Pratama Tbk decreased to 56%, PT Bakrie Telekom Tbk 88%, PT Infoasia Teknologi Global Tbk 100%, and PT Mobile-8 Telecom 81% (Indonesian Capital Market Directory, 2009). These telecommunication industries have done many efforts to maintain its financial performance. PT Indosat Tbk keep on giving the cash dividends in 2009 for almost 749 billion rupiah or Rp 137.86 per share, although the nominal earnings per share (EPS) is lower than previous year. The cash dividend is almost 50% of the company’s profit in 2009. This decision is to guarantee the financial performance for its investors (kompas.com,2009). Besides the impact of the global financial crisis the telecommunication industry also facing the open market policy after the implementation of regulation No.36 year 1999. The regulation has stop the monopoly of two telecommunication company which are PT Telkom and PT Indosat in 2003. Since then many telecommunication company join the industry such as Excelcomindo, Bakrie Telekomunikasi, Natrindo and Mobile 8 The measure of financial performance can link the interest of the management of the company with the investors. The management is interested in the high reward in managing the company meanwhile the investors interested in the return of their investment. This Agency conflict can be minimized by implementing the open book management as one of the implementation of Good Corporate Governance. The financial performance can be seen from the evaluation of financial ratios such as the growth of EPS, CFO, and EVA (Helfert, 2000:402). This financial evaluation will effect to the value of the stock return received by the share holders. II. Literature Review Earnings Per Share (EPS) EPS shows the possible return that can be expected by the share holders. The growth of the EPS reflect the growth of the profit and also the return for the share holders. Gitman (2005:68). ”The firm’s earning per share (EPS) is generally of interest to present or prospective stockholders and management.” Gallagher & Andrew (2003:106): “To calculate EPS, we devide earning available to common stockholders by number of shares of common stock.” Cash Flow Operation (CFO) Cash Flow Operation is one indicator to measure whether from its operational activity company can result fund to meet its liabilities, maintain its operational capability, pay the dividend and make new investment without outside funding (Pradhono, 2004). The growth of CFO indicates how does the company manage its working capital well. 10th UBAYA INTERNATIONAL ANNUAL SYMPOSIUM ON MANAGEMENT ISBN: 978-979-99365-7-8 458 Reilly & Brown (2003:316): “Cash flow from operating activities. This section list the fund and uses the fund sources and uses that arise from the normal operations of a firm. In general, the net cash flow from operation is computed as the net income reported on the income statement including changes in networking capital items (i.e receivables, inventories, etc) plus adjustment for non cash revenues and expenses or CFO=NI + Depreciation + Change in Net Working Capital Items”. Economic Value Added (EVA) EVA is indicator of value creation of an investment (Afriani, 2005:3). Evaluation performance based on EVA gives information to investors in selecting which company to invest in. Stern & Shiely (2001:15): ''EVA is the profit that remains after deducting the cost of the capital invested to generate that profit''. Gitman (2006 : 513 ): “Eva is a popular measure used by firms to determine wether an investmen contributes positively to the owners wealth. Keown, et.al (2000:421): “Economic Value Added is the difference in a firm’s net operating profit after tax (NOPAT) and the capital charge for the period (i.e., the product of the firm’s cost of capital and its invested capital at the beginning of period). The growth of EVA where its value is > 0, means that return has grow higher than the cost of capital. This conditions showed that company manage to create value for the investors since it increase the value of the firm. Stock Return Stock of the company can be evaluate from its return received by the shareholders. Return can be obtained from the cash dividend paid by the company and also the difference in the price of the stock (capital gain/loss), Ross (2002:286). Return is the profit of an investment.. Return can be realized return which is or expected return in the future period. (Jogyanto,2007:109). The measurement of stock return is (Jogyanto,2007:111): Information about the return that can be resulted from investment can be obtain from the evaluating the financial performance of the company. Based on fundamental analysis one of the indicators is the financial report of the company. Helfert (2000:402) said that measurement of financial performance can be divided into three categories: 1) Earnings Measures, based the financial performance on the accounting profit. This category includes earnings per share (EPS), return on investment (ROI), return on net assets (RONA), return on capital employed (ROCE) and return on equity (ROE). Gitman (2005 : 68) said EPS can be measured by: 1 1

/pdf/evaluating-the-financial-performance-using-the-growth-of-eps-52ncqmfl3i.pdf

Evaluating the financial performance using the growth of eps, cfo, and eva and their impact to the stock return of listed telecommunication industry in bei

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Evaluating the financial performance using the growth of eps, cfo, and eva and their impact to the stock return of listed telecommunication industry in bei