The Effect of EPS and Return on BEI IDX using Value Investing from Benjamin Graham

PENGARUH EPS DAN RETURN SAHAM TERHADAP IHSG BEI MENGGUNAKAN VALUE INVESTING DARI BENJAMIN GRAHAM

Abstract

This study intends to analyze the value of existing companies in Indonesia Stock Exchange (BEI) to select stocks which will gain a high level of return in the long term. Using fundamental analysis method of value investing Benjamin Graham, this method is used to select undervalued stocks, stocks that are expected to provide high returns over the long term. This study was conducted on 20 companies selected according to the criteria of value investing Graham of 331 companies that listed on the BEI in the period 2005 to 2012. With those datas, the research analyze the effect of Earning Per Share (EPS) and Return of the Shares on IHSG. Pooled Least Square method with the regression equation will be obtained. The result said that changes in the value of EPS is not a significant effect on changes IHSG in BEI, but changes in the value of stock returns has significant impact on IHSG changing, while the variable IHSG simultaneously influenced by both variables, EPS and stock return variable.