Financial Distress Analysis Of Hotel Companies Listed On The Indonesia Stock Exchange During The Covid-19 Pandemic
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Published:
Jul 23, 2022
Keywords:
Covid-19, Financial Distress, Altman's Z Score Modified, Hotel Companies, Indonesia Stock Exchange
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Computer Science
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Abstract
Financial Distress is a situation that portrays the organization's financial condition, whether the organization is in a tough situation, emergency or undesirable that happened before the organization failed. This study aims to analyze Financial Distress in hotel companies registered on The Stock Exchange of Indonesia during the Covid-19 pandemic for the 2020-2021 utilizing the Altman's Z-Score modified model. The sampling of this research is 19 financial statements of hospitality companies in the period 2020-2021. The Outcomes showed that during the Covid-19 Pandemic from 2020 to 2021, of the 19 companies that were the sample of this study, 10 companies (53%) were in the Distress Area and the Gray Area. The remaining 9 companies (47%) are in the Non Distress Area. This study concludes that the COVID-19 pandemic for the 2020-2021 period has had quite an impact on financial distress for hotel companies filed on the Indonesia Stock Exchange.
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Dachlan, R. S. (2022) “Financial Distress Analysis Of Hotel Companies Listed On The Indonesia Stock Exchange During The Covid-19 Pandemic”, Jurnal Mantik, 6(2), pp. 1829-1836. doi: 10.35335/mantik.v6i2.2646.
References
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[25] Z. (June) Cheng, J. Fang, and Y. Zhang, “The Dual Effect of Financial Distress on Stock Pricing and Realized Return,” SSRN Electron. J., Mar. 2022, doi: 10.2139/SSRN.4058257.
[26] C. López-Gutiérrez, S. Sanfilippo-Azofra, and B. Torre-Olmo, “Investment decisions of companies in financial distress,” BRQ Bus. Res. Q., vol. 18, no. 3, pp. 174–187, 2015, doi: https://doi.org/10.1016/j.brq.2014.09.001.
[27] R. Ahmadi and H. Kordloei, “The Effect of Financial Distress on the Investment Behaviour of Companies Listed on Tehran Stock Exchange,” Adv. Math. Financ. Appl., vol. 3, no. 4, pp. 17–28, 2018, doi: 10.22034/AMFA.2019.565459.1108.
[28] E. I. Altman, “Financial ratios, discriminant analysis and the prediction of corporate bankruptcy,” J. Finance, vol. 23, no. 4, pp. 589–609, 1968.
[29] E. Altman, “Predicting Financial Distress Of Companies: Revisiting The Z-Score And Zeta,” in Handbook of Research Methods and Applications in Empirical Finance, vol. 5, Edward Elgar Publising, 2000. doi: 10.4337/9780857936097.00027.
[30] E. I. Altman, M. Iwanicz-Drozdowska, E. K. Laitinen, and A. Suvas, “Financial Distress Prediction in an International Context: A Review and Empirical Analysis of Altman’s Z-Score Model,” Journal of International Financial Management and Accounting, vol. 28, no. 2. pp. 131–171, 2017. doi: 10.1111/jifm.12053.
[31] E. F. Brigham and J. F. Houston, Fundamentals of Financial Management. Cengage Learning, Boston, USA, 2019. doi: 10.2307/2327254.
[2] M. S. Al Ali, “Risk Velocity and Financial Markets Performance: Measuring the Early Effect of COVID-19 Pandemic on Major Stock Markets Performance,” Int. J. Econ. Financ. Res., vol. 6, no. 64, pp. 76–81, 2020, doi: 10.32861/ijefr.64.76.81.
[3] H. Liu, A. Manzoor, C. Wang, L. Zhang, and Z. Manzoor, “The COVID-19 outbreak and affected countries stock markets response,” Int. J. Environ. Res. Public Health, vol. 17, no. 8, pp. 1–19, 2020, doi: 10.3390/ijerph17082800.
[4] N. Collins, “Effect of COVID-19 Pandemic on Global Stock Market Values: A Differential Analysis,” Acta Univ. Danubius. Œconomica, vol. 16, no. 2, pp. 255–269, 2020, [Online]. Available: https://journals.univ-danubius.ro/index.php/oeconomica/article/view/6548/0
[5] E. Purwitajati and I. M. P. D. Putra, “Pengaruh Debt To Equity Ratio pada Return Saham dengan Ukuran Perusahaan sebagai Pemoderasi,” E-Jurnal Akunt. Univ. Udayana, vol. 15, no. 2, pp. 1086–1114, 2016.
[6] Z. Bodie, A. Kane, and A. J. Marcus, Investments, 11th ed. McGraw-Hill Education, New York, 2018.
[7] M. Majied Sumatrani Saragih, S. Sinaga, R. Nur Ilham, S. Tinggi Ilmu Ekonomi Bina Karya Tebing Tinggi, and S. Utara, “The Impact of the Covid-19 Pandemic on Stock Investment in the Indonesian Capital Market,” Manag. Res. Behav. J., vol. 1, no. 1, pp. 1–6, Jun. 2021, doi: 10.29103/MRBJ.V1I1.3784.
[8] H. D. Platt and M. B. Platt, “Predicting corporate financial distress: Reflections on choice-based sample bias,” J. Econ. Financ., vol. 26, no. 2, pp. 184–199, 2002, doi: 10.1007/BF02755985.
[9] Z. Kisman and D. Krisandi, “How to Predict Financial Distress in the Wholesale Sector: Lesson from Indonesian Stock Exchange,” J. Econ. Bus., vol. 2, no. 3, pp. 569–585, 2019, doi: 10.31014/aior.1992.02.03.109.
[10] K. H. Wruck, “Financial distress, reorganization, and organizational efficiency,” J. financ. econ., vol. 27, no. 2, pp. 419–444, 1990, doi: https://doi.org/10.1016/0304-405X(90)90063-6.
[11] R. B. Whitaker, “The early stages of financial distress,” J. Econ. Financ., vol. 23, no. 2, pp. 123–132, 1999, doi: 10.1007/BF02745946.
[12] D. Efriyenty and N. M. Br Purba, “Use of Profit and Cash Flows in Predicting Financial Distress Food and Beverage Companies,” Own. Ris. dan J. Akunt., vol. 6, no. 2 SE-, pp. 1239–1248, Jan. 2022, doi: 10.33395/owner.v6i2.544.
[13] F. Zhou, L. Fu, Z. Li, and J. Xu, “The recurrence of financial distress: A survival analysis,” Int. J. Forecast., vol. 38, no. 3, pp. 1100–1115, Jul. 2022, doi: 10.1016/J.IJFORECAST.2021.12.005.
[14] A. H. Manurung, Keuangan Perusahaan, 1st ed. Jakarta: PT Adler Manurung Press, Jakarta, 2021.
[15] M. Karas and M. Reznakova, “Cash Flows Indicators in the Prediction of Financial Distress,” Eng. Econ. , vol. 31, no. 5, pp. 525–535, Dec. 2020, doi: 10.5755/J01.EE.31.5.25202.
[16] Y. Lian, “Financial distress and customer-supplier relationships,” J. Corp. Financ., vol. 43, pp. 397–406, 2017, doi: https://doi.org/10.1016/j.jcorpfin.2017.02.006.
[17] P. Asquith, R. Gertner, and D. Scharfstein, “Anatomy of Financial Distress: An Examination of Junk-Bond Issuers*,” Q. J. Econ., vol. 109, no. 3, pp. 625–658, Aug. 1994, doi: 10.2307/2118416.
[18] F. Buera and S. Karmakar, “Real Effects of Financial Distress: The Role of Heterogeneity,” Econ. J., vol. 132, no. 644, pp. 1309–1348, May 2022, doi: 10.1093/ej/ueab083.
[19] J. Sun, F. Yin, E. Altman, and L. Makosa, “Effects of corporate financial distress on peer firms: do intra-industry non-distressed firms become more conditionally conservative?,” Account. Bus. Res., pp. 1–25, May 2022, doi: 10.1080/00014788.2022.2052006.
[20] A. Rodoni and H. Ali, Manajemen Keuangan Modern, 1st ed. Jakarta: Mitra Wacana Media, 2014.
[21] S. Munawir, Analisa Laporan Keuangan, 4th ed. Penerbit Liberty, Yogyakarta, 2014.
[22] S. Saat and Rudianto, Akuntansi Manajemen?: Informasi Untuk Pengambilan Keputusan Strategis, 1st ed. Jakarta?: Erlangga, 2013.
[23] C. M. Reinhart, “From Health Crisis to Financial Distress,” IMF Econ. Rev., vol. 70, no. 1, pp. 4–31, 2022, doi: 10.1057/s41308-021-00152-6.
[24] K. D. Duong, L. T. D. Truong, T. N. Huynh, and Q. T. Luu, “Financial constraints and the financial distress puzzle: Evidence from a frontier market before and during the Covid-19 pandemic,” Invest. Anal. J., vol. 51, no. 1, pp. 35–48, Jan. 2022, doi: 10.1080/10293523.2022.2037202.
[25] Z. (June) Cheng, J. Fang, and Y. Zhang, “The Dual Effect of Financial Distress on Stock Pricing and Realized Return,” SSRN Electron. J., Mar. 2022, doi: 10.2139/SSRN.4058257.
[26] C. López-Gutiérrez, S. Sanfilippo-Azofra, and B. Torre-Olmo, “Investment decisions of companies in financial distress,” BRQ Bus. Res. Q., vol. 18, no. 3, pp. 174–187, 2015, doi: https://doi.org/10.1016/j.brq.2014.09.001.
[27] R. Ahmadi and H. Kordloei, “The Effect of Financial Distress on the Investment Behaviour of Companies Listed on Tehran Stock Exchange,” Adv. Math. Financ. Appl., vol. 3, no. 4, pp. 17–28, 2018, doi: 10.22034/AMFA.2019.565459.1108.
[28] E. I. Altman, “Financial ratios, discriminant analysis and the prediction of corporate bankruptcy,” J. Finance, vol. 23, no. 4, pp. 589–609, 1968.
[29] E. Altman, “Predicting Financial Distress Of Companies: Revisiting The Z-Score And Zeta,” in Handbook of Research Methods and Applications in Empirical Finance, vol. 5, Edward Elgar Publising, 2000. doi: 10.4337/9780857936097.00027.
[30] E. I. Altman, M. Iwanicz-Drozdowska, E. K. Laitinen, and A. Suvas, “Financial Distress Prediction in an International Context: A Review and Empirical Analysis of Altman’s Z-Score Model,” Journal of International Financial Management and Accounting, vol. 28, no. 2. pp. 131–171, 2017. doi: 10.1111/jifm.12053.
[31] E. F. Brigham and J. F. Houston, Fundamentals of Financial Management. Cengage Learning, Boston, USA, 2019. doi: 10.2307/2327254.
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