When signals meet sustainability: Stock price transitions across EPS, RETE, Interest Rate, and ESG Categories in Indonesian property firms
DOI:
https://doi.org/10.58784/ramp.485Keywords:
earnings per share, retained earnings to total equity, interest rate, ESG score, transition network analysis, tri hita karana, stock priceAbstract
Stock prices in Indonesia's property and real estate sector fluctuated markedly between 2021 and 2025, reflecting the joint influence of firm-level fundamentals and macroeconomic conditions—yet most prior studies examine profitability, corporate life-cycle, and interest-rate signals in isolation from sustainability status, and rely on single cross-sectional snapshots rather than longitudinal evidence. This study addresses that gap by examining differences in stock prices across categories of Earnings Per Share (EPS), Retained Earnings to Total Equity (RETE), and interest rates, and by exploring how these signals interact with Environmental, Social, and Governance (ESG) Score status. Using secondary data from 31 listed companies (620 quarterly observations, 2021–2025) analyzed through the Friedman test, the Durbin–Conover post hoc test, and a supplementary Transition Network Analysis (TNA), the study finds statistically significant stock price differences across all EPS, RETE, and interest-rate categories, consistent with Signaling Theory. TNA further reveals that stock prices were predominantly stable across all 16 EPS–RETE–interest-rate–ESG combinations, but ESG-recognized firms reverted from Bull to Normal conditions far more readily (0.94–0.97) than non-ESG firms (0.60–0.69), a divergence interpreted through the Balinese-Hindu philosophy of Tri Hita Karana as reflecting differences in how firms balance profit generation with environmental and social responsibility. These findings suggest that sustainability status shapes not merely the direction but the character of stock price dynamics, offering both a longitudinal extension of signaling-based capital market research and a novel integration of Western finance theory with an indigenous value-based framework.
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