The Effect of Capital Adequacy Ratio and Non Performing Loan on Banking Stock Prices with Profitability as Intervening Variable

ABSTRACT : This study aims to determine the role of profitability in mediating the Capital Adequacy Ratio(CAR) and Non Performing Loans (NPL) on banking stock prices. The sample used was 4 companies listed onthe Indonesia Stock Exchange in 2011-2018. Determination of the sample using purposive sampling method.The analysis used the sobel test to determine the indirect effect of variables and simple regression for directanalysis between variables. The results of the analysis show that the CAR variable has a positive effect on ROA,the NPL variable has a negative effect on the ROA variable. CAR variable has a positive effect on stock prices.NPL variable has a negative effect on stock prices. CAR variable has an influence on stock prices through ROA.And the NPL variable has an influence on stock prices through ROA.

KEYWORDS : capital adequacy ratio, non performing loan, profitability, stock price