THE EFFECT OF BANKRUPTCY POTENTIAL ON STOCK PRICES OF MANUFACTURING COMPANIES LISTED ON THE INDONESIA STOCK EXCHANGE

Abstract

The purpose of this study is to analyzE the impact of bankruptcy potential on stock prices of manufacturing companies listed on the Indonesian Stock Exchange with the use of the Zmijewski method (X-Score). The study methodology employed a quantitative descriptive approach, which was then processed and analyzed for concluding results. The study population comprises manufacturing companies listed on the Indonesian Stock Exchange between 2017 and 2021.  The sample selection criteria were predetermined, resulting in 104 companies being selected over a 5-year observation period. The data analysis technique used a regression approach and processed using the Eviews program. The regression analysis of the panel data reveals a negative influence of the bankruptcy potential (X-Score) on stock prices with company size and covid-19 period as control variable.