The Effect of Fundamental Factors on Stock Prices in the Energy Sector in Indonesia

Abstract

Indonesia’s capital market has experienced significant growth, driven by increasing market capitalization and a surge in the number of investors. The energy sector plays a key role in this growth, attracting investors despite its high stock price volatility and risk-return potential. This research aims to examine and analyze the effect of leverage, profitability, and dividend policy on stock prices, with investment decisions as a moderating variable, in energy sector companies listed on the Indonesia Stock Exchange for the 2020–2024 period. Using a quantitative approach, the research sample consists of 16 companies selected through a purposive sampling method, resulting in a total of 80 observations. The data analysis technique employed is Moderated Regression Analysis (MRA) using IBM SPSS 26 software. The results indicate that, partially, leverage, profitability, and dividend policy have a positive and significant effect on stock prices. Investment decisions were found to be unable to moderate the effect of leverage and profitability; however, they were proven to negatively moderate the effect of dividend policy on stock prices. Simultaneously, all independent variables and their interactions have a significant effect on stock prices. The energy sector market operates rationally, prioritizing actual financial signals such as realized earnings and cash dividends over physical expansions. Therefore, companies should optimize their capital structure and carefully evaluate aggressive expenditures to sustain investor confidence without triggering market skepticism.