Dividend Policy: Its Influence on the Value of the Enterprise

Abstract

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What's in a Name? Reputation Building and Corporate Strategy.

“…Dividend policy. Another aspect of market performance that investors attend to is a firm's dividend policy (Walter, 1971). Dividend payouts, however, can signal rival messages.…”

Application of Financial Decisions, their Determinants, and Financial Performance: A Tabular Summary of Systematic Literature Review

“…Miller and Modigliani (1961) 1: The firms have the independence of investment and dividend policies. As dividend policies are not associated with the firm value assuming perfect capital markets 2: Bird in Hand Theory Gordon (1959), Gordon (1963), Walter (1963), Bhatacharya (1979), Rozeff (1982), Gombola and Feng-Ving (1993) 2: Cash in hand is always preferred by the investor as compared to the future promise of capital gain due to risk minimization or lowering. Jensen and Meckling (1976) 3: Dividends are the payments that reduce the availability of the cash for managers.…”

The Dividend Policy in Manufacturing Sector of Pakistan: The Perception of Corporate Managers

“…Researchers have proposed many different theories about the factors that influence a firm'sdividend policy. Although numerous theories, models, and explanations exist, most broad and commonly used theories includes: Bird-in-the-hand theory given by Gordon (1963) and Walter (1963) argues that investors prefer cash in the hand rather than a future promise of capital gains due to lower risk. Dividends mitigate information asymmetry between management and shareholders by conveying private information about a firm's future prospects called signaling explanation of dividends (Bhattacharya, 1979, John & Williams, 1985.…”