Business Economics – Regression Analysis

Effect of symmetry Profitability recidivate on Asset (ROA) and Return of Equity (ROE) to Stock Price of PT Bank Central Asia (BCA) Tbk. Ratio profitability, Return on Asset (ROA) and Return of Equity (ROE), of a riotous is used as one of parameters for investor to decide whether they want to invest or not. The following table consists of ROA and ROE as well as the behave expense of PT Bank Central Asia (BCA) Tbk. , as one of the largest savings bank in Indonesia, from year of 2002 up to 2011. Table 1. ROA, ROE and stock cost of PT Bank Central Asia Tbk. tahun 2002-2011 Year Stock Price(Y) ROA(X2) ROE(X2) 2002 2500 2. 17 22. 08 003 3325 2. 36 24. 87 2004 2975 3. 04 32. 52 2005 3400 3. 41 32. 33 2006 5200 3. 43 33. 58 2007 7300 1. 68 16. 47 2008 5778 3. 14 33. 16 2009 5645 3. 17 32. 11 2010 4284 3. 28 31. 23 2011 3674 2. 65 24. 16 Using regression analysis we want to image the relationship between ROA, ROE and stock impairment of PT BCA Tbk. In this case, ROA and ROE are the i ndependent or instructive uncertain (X), small-arm stock footing is the dependent variable that we want to explain (Y). retroflexion Analysis SUMMARY OUTPUT Regression Statistics Multiple R 0. 13028475 R Square 0. 016974116 Adjusted R Square -0. 63890422 Standard Error 1710. 529517 Observations 10 ANOVA df SS MS F Signifi give the gatece F Regression 2 353656. 3 176828. 15 0. 060435241 0. 941840446 Residual 7 20481378. 6 2925911. 229 Total 9 20835034. 9 Coefficients Standard Error t Stat P-value Lower 95% focal ratio 95% Lower 95. 0% Upper 95. 0% Intercept 5361. 609293 2796. 526605 1. 917238793 0. 096721961 -1251. 125335 11974. 34392 -1251. 125335 11974. 34392 X Variable 1 -142. 3275587 3749. 125063 -0. 037962873 0. 970777259 -9007. 599603 8722. 944486 -9007. 599603 8722. 944486 X Variable 2 -19. 7879081 375. 1702777 -0. 051919867 0. 960043105 -906. 6155278 867. 6579462 -906. 6155278 867. 6579462 From the summary end product we can estimate the linear relationsh ip between the stock price (Y) and ROA (X1), ROE (X2) in the form of equation below Y= 5361. 6092 142. 3275 X1 19. 4788 X2 The firmness of purpose indicates that for each 1% decrease in ROA and ROE the stock price decrease by IDR142. 3275 (the estimated coefficient of X1) and IDR19. 4788 (the estimated coefficient of X2) also, respectively. To understand how monumental the independent variable can explain the dependent variable, we can observe from t-stat data.The critical value of t at the 0. 05 level of significance is 2. 365 (from table of the t distribution). The analysis outgrowth show that t-stat value below the critical value of t = 2. 365. It convey that at the 5% level of significance, we accept there is no significant relationship between ROA, ROE and stock price. We collect more variable better than just ROA and ROE to picture the movement of price stock. The deuce variables, ROA and ROE, are not enough to explain the stock price of PT BCA Tbk. Now, we want to see how good is the model or how much the explanatory power of the model by looking at R2 data.R2 measures how much of the sport in the firms stock price is explained by the var. in its ROA and ROE. The analysis result shows that the value of R2 is 0. 016974116, extreme to 1. It means that none of the variation in stock price was explained by the variation in ROA and ROE. In conclusion, looking at the value of t-stat and R2, variable ROA and ROE is not enough to explain the movement of stock price PT BCA Tbk. We need to add more variables to get more description how the stock price change and how significant and sensitive the variables impact to stock price.