The Effect of Liquidity, Solvency, Activity, and Profitability on Financial Performance of Manufacturing Companies

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Analysis reveals liquidity and profitability positively influences financial performance in manufacturing, while solvency has a negative effect.

Liquidity shows a significant positive effect on financial performance.
Solvency negatively affects financial performance, indicating potential risks.
Activity does not significantly impact financial performance in this analysis.
Profitability demonstrates a strong positive correlation with financial performance.

Kensa et al. (2025) studied this question.

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Analysis reveals liquidity and profitability positively influences financial performance in manufacturing, while solvency has a negative effect.