Effect of Dividend on Stock Price in Emerging Stock Market: A Study on the Listed Private Commercial Banks in DSE

Ali, Mohammad Bayezid; Chowdhury, Tanbir Ahmed

doi:10.5539/ijef.v2n4p52

Cited by 23 publications

(15 citation statements)

References 25 publications

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“…Outra conclusão em diversos estudos é a de que o anúncio da distribuição de dividendos sinaliza os investidores, pela análise da volatilidade apresentada pelas cotações (PETTIT, 1972;CHAREST, 1978;ALI;CHOWDHURY, 2012). Os dividendos são considerados um instrumento redutor da incerteza e risco associado aos cash-flows da empresa, esta informação obtida através dos dividendos é normalmente conhecida como o "conteúdo informativo dos dividendos".…”

Section: Assimetria Da Informaçãounclassified

Determinants of Dividend Policy in Portugal

Almeida

Tavares

Pereira

2014

RUC

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Os dividendos a par dos investimentos e do financiamento, são tidos como as decisões financeiras mais importantes na vida das empresas. Contudo os determinantes da política de dividendos não obtêm consenso no mundo das finanças empresariais. Black (1976) classificou o tema como "dividend puzzle", por ser uma questão ainda sem solução. Teorias como a teoria da relevância dos dividendos, teoria da agência, e teoria da sinalização ou assimetria de informação, têm contribuído

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Section: Assimetria Da Informaçãounclassified

Determinants of Dividend Policy in Portugal

Almeida

Tavares

Pereira

2014

RUC

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“…The research byBlack and Scholes (1974) further emphasizes that dividend policy does not have significant relation with common stock prices. There are other group of researchers like Bhole (1980), Ali and Chowdhury (2010), and Grullon and et al (2005), who are of the view that dividend policy is irrelevant in determining share prices and dividend changes contain no information about future earning changes. As such, any variation on share prices cannot be explained well by dividend policies.…”

Section: Review Of Literaturementioning

confidence: 99%

Dividend Policy, Share Price and Future Profitability: Case of Commercial Banks in Nepal

Dhakal¹,

Shah²

2018

J. Bus. Soc. Sci. Res.

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<p>The study analyzes the impact of dividend policy on share price and future profitability of commercial banks in Nepal. Using panel secondary data of 13 commercial banks from year 2001 to 2014, correlation and regression analysis are applied for the study. The impact of dividend policy on share price is analysed first and the findings of initial analysis suggests that dividend yield and retention ratio have significant negative impact, whereas earning per share has significant positive impact on share price. The study, thus, supports the dividend relevance in Nepalese capital market, and it is further extended to analyze whether dividend changes carried any special information influencing future profitability of commercial banks in two subsequent year of dividend declaration. The conclusion from the analysis indicates that the current year dividend change has significant impact on current year earning changes. For subsequent years, the impact of dividend change is insignificant. Thus, dividend change does not carry information regarding changes in earning in subsequent years of dividend declaration and does not support signalling hypothesis in Nepalese capital market.</p><p>Journal of Business and Social Sciences Research, Vol. 1, Issue 1, pp. 89-110</p>

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“…These findings complement that of Rimbey and Officer (1992), Koch and Sun (2004), Kadioglu (2008) Asamoah and Nkrumah (2010). The insignificant impact on the returns could also be due to the presence of insider trading (Ali & Chowdhury (2010). There might also be a possibility that the sample firms have entered the decline stage of their life-cycle where they have less investment opportunities as supported by the Maturity Hypothesis (Fracassi, 2008).…”

Section: Analysis Of Cash Dividend Announcementsmentioning

confidence: 99%

Signaling mechanism of corporate payout policy: A case of Indian firms

Anwar¹,

Singh²,

Jain³

2016

10.5267/j.ac

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Historically, cash dividends are the most important form of payout policy; however, they have been losing popularity relative to share repurchases. This paper examines the signaling effect of the payout decisions namely, cash dividends and share repurchases by BSE 500 index companies. It attempts to uncover the underlying forces behind the firm's choices of payout policy in the Indian context. Using the standard 'Event Standard Methodology', a strong case of positive signaling is reported in case of repurchase announcements vis-a-vis cash dividend announcements. It is observed that cash dividends are not perceived by investors as positive signals as they prefer their earnings to be retained by the companies for growth prospects. In case of share repurchases, the existence of undervaluation, signaling and wealth transfer hypotheses is reported, consistent with the fact the share repurchases are welcomed by the Indian companies. The results would provide insights into the economics of the choice between cash dividends versus share repurchases as payout mechanism adopted by the sample companies. The findings would also be useful to the academia as well as industry in understanding the payout practice and the extent to which the Indian managers use the assumptions, models and decision rules regarding payout.

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Effect of Dividend on Stock Price in Emerging Stock Market: A Study on the Listed Private Commercial Banks in DSE

Cited by 23 publications

References 25 publications

Determinants of Dividend Policy in Portugal

Determinants of Dividend Policy in Portugal

Dividend Policy, Share Price and Future Profitability: Case of Commercial Banks in Nepal

Signaling mechanism of corporate payout policy: A case of Indian firms

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