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CHAPTER III METHODOLOGY
A. Data Collection Method
A type of data used is secondary data. Data is used in this study were obtained from financial report those gotten from Indonesia Stock
Exchange. B.
Research Scope
This research is quantitative data used are secondary data. The sample used was data from the initial public offering Y, and financial
ratios X with sub variables are Cash Flow to Current Liabilities X1 , Net Worth and Total Liabilities to Fixed Assets X2, Gross Profit to Sales
X3, Net Income to Sales X4, Operating Income to Total Liabilities X5, Net Worth to Sales X6, Net Income to Total Liabilities X7, Net
Income to Net Worth X8 and Net Worth to Total Liabilities X9. In this research will be used ratio that was used by previous
research Mas’ud Machfoedz which 9 ratios where the ratios have significant influence to predict company future profit. Those ratios are
Total Go Public company that listed in Stock exchange Jakarta are 422 companies which divided into some sectors, among them are banking
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sector. Companies in banking sector are 31 companies, for this research limited to companies from banking sector which is go public from 2006-
2009 for only 10 companies.
C. Variable Definition and Measurement of Operational
In this analysis the dependent variable y is initial public offering, while independent variable x is financial ratios. Formula in this research
is:
I nitial Public Offering = α + βCFCL
1
+ βNWTLFA
2
+ βGPS
3
+ βNIS
4
+ βOITL
5
+ βNWS
6
+ βNINTL
7
+ βNINW
8
+ βNWTL
9
+ +
ε
it
;
Where: a A
= Constants b B1, b2, b3, b4, b5, b6, b7, b8, b9 = Coefficient
c CFCL = Cash Flow to Current Liabilities
Ratio d NMTLFA
= Net Worth and Total Liabilities to Fixed Asset Ratios
e GPS = Gross Profit to Sales Ratio
f NIS = Net Income to Sales
g OITL = Operating Income to Total
Liabilities Ratio
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h NWS = Net Worth to Sales Ratio
i NITL = Net Income to Total
Liabilities Ratio j NINW
= Net Income to Net Worth Ratio k NWTL
= Net Worth to Total Liabilities Ratio
D. Population and Sample
Method that will be used is purposive sampling which is means population that will be used as research sample is population that filled the
certain sample criteria according to what researcher wants and chosen sample will be selected tightly so become relevant with research pattern.
Researcher will try in order to inside the sample there is representative from every kind of population.
Thus, it is important for sample have essential characteristic, what strata that should be represented, depend to scoring or consideration from
the researcher. This technique is chosen in order the result more accurate. Criteria for sample consideration are:
1. Go public company which is noted as banking institution 2. Have a financial report for 2006-2009
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