Abstract:
The modern business world is constantly changing. Consequently, companies must
face and fight to change competition conditions by adapting appropriately. In this respect, the
organization believes that only tangible assets are insufficient to compete with competitors.
Therefore, the present study attempts to analyze the impact of intellectual capital (IC) on
stock prices with financial performance as an intervening variable. For the study, data were
collected using a random sampling method from 2015 to 2022. Descriptive calculations,
multiple regression appraisals, and the Sobel examination were utilized to find the results.
The analyzed results indicated that IC has a significant impact on the financial performance
of the companies. However, the researcher does not have strong statistical evidence to
conclude that IC significantly affects the stock price, with financial performance as an
intervening variable. Only physical capital significantly impacts the stock price when ROE is
used as an intervening variable. The results are significant for all the stakeholders, especially
for investors in making their investment decisions on the company shares. Companies could
also realize the importance of IC to obtain competitive advantages and face market
challenges and competition.
Some theories explain that positive relationships exist between IC, financial performance,
and stock prices of the companies. There will be a gap when the study's findings are
compared with the theoretical conclusions. For the problem, researchers believe that the
country's conditions may moderate the relationship between IC, financial performance, and
companies' stock prices. Therefore, the researcher suggested that future researchers conduct
the same problem with different samples and draw fruitful conclusions and recommendations
for the relevant stakeholders.
