Profitability as an Intervening Variable of the Effect of Dividend Policy and Leverage on the Value of LQ45 Companies Listed on the Indonesia Stock Exchange

This study seeks to gather empirical evidence regarding the impact of Dividend Policy and Leverage on the performance of LQ45 Companies listed on the Indonesia Stock Exchange. Purposive sampling was employed to select the research samples, resulting in 21 companies being included in the study for the period spanning from 2019 to 2022, constituting 84 units of analysis. The research methodology adopted a quantitative descriptive approach, with path analysis being the chosen analytical technique. The findings indicate that neither leverage nor Dividend Policy directly affects Profitability. However, both Leverage and Profitability significantly positively influence firm value, whereas Dividend Policy does not. Moreover, Profitability serves as a mediator in the relationship between Dividend Policy and Firm Value but does not mediate the connection between Leverage and Firm Value. This study underscores the importance for companies to carefully consider their leverage and profitability, which can significantly impact firm value and ultimately enhance overall company performance.