Colaboraciones. n= 334

Nowadays, stock market is one of the most important elements in investment world. One of the critical issues related to stock market often debated is the effect of financial ratios to stock return. This research aims to investigate the effect of financial ratios to stock return in ISO 9001 certified companies.

The research result shows that financial ratios, i.e. return of equity (ROE), Debt equity ratio (DER), Current Ratio (CR), Total asset turnover (TATO), and earnings per share (EPS) do not have significant effect on ISO 9001 certified companies’stock returnseitherpartially orsimultaneously.Thiscondition can be caused by two things, i.e. global financial crisis impact emerging on research period and linkage with the context of the research objects, i.e. ISO 9001 certified companies.

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only tested five financial ratios. Research result might be different if more financial ratios are used.

Second, this research did not consider other factors that might affect the relationship between financial ratios and stock return or factors that might affect the stock return directly whether can be controlled by the company or not. The uncontrollable factors are, for example, crime rate of a country (Laverde, Varua, and Ozane, 2009), stock price movements (Grinblatt and Moskowits, 2004), macro-economy (Samitas and Kenourgious, 2007), political situation (Pedro and Rossen, 2000), government policy (Wang, 2010), interest rate (Bashir and Hassan, 1997), and inflation rate (Gultekin, 1983). Meanwhile, the controllable factorsare,forexample,company’ssize(Nur,2001)and non-financial performance. Third, this research also had limitations on the sample size and observation period. The research result, therefore, may not be generalized for entire listed ISO 9001 certified companies in Indonesia.

Given mentioned limitations, in the future research, the author suggest to develop research model – particularly on research variables, objects, and observation period –in assessing the impact of financial ratios on stock return in ISO 9001 certified companies. Moreover, the authors also suggest testing the direct influence of ISO 9001 certification to stock return.

Acknowledgement

We would like to thanks to Nur Metasari and all party that supported this research.

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