Impact of Dividend Policy, Earning per Share, Return on Equity, Profit after Tax on Stock Prices (original) (raw)
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International Journal of Academic Research in Economics and Management Sciences
The study aims at investigating the relationship between dividend payout and the stock price of listed companies in Karachi Stock Exchange and to establish the extent of the relationship between them. The data were collected from Karachi Stock Exchange from 2003 to 2008. Five firms from textile industry were selected purposively. Stock price was dependent variable while the independent variable was dividend payout ratio. The size of firm, earning volatility and growth were selected as controlled variables. Multiple regression model was employed to explore the relationship of dependent with independent variables. Results showed that overall models were good fit showed by coefficient of determination values. Dividend payout ratio was significantly affecting the stock price. Other variables sowed mixed results in some models were found significant.
The economic behavior of companies have great importance because these behavior have great influence on performance of firms. In Pakistan, economic behavior has hardly explored. The present study analyzed the impact of dividend yield and price earnings ratio on stock returns. The relationship between size and stock price were also determined. In present study, the data of 111 non-financial KSE listed firms for period of 1998 to 2009 have used. The advance econometrics techniques were employed for analysis and determining the relationship of these variables. The impact of dividend yield and price earnings ratio on stock returns was determined by using fixed effect model. The findings of study reveals that price earnings ratio and size of firm have significant positive impact on stock prices. There were found significant negative relationship between dividend yield and stock prices. The findings also suggests that investors can apply investment criteria that employ size of firm and pr...
Effect of Dividends on Stock Prices– A Case of Chemical and Pharmaceutical Industry of Pakistan
Management, 2012
Corporate sector of Pakistan is adversely facing co mpetition due to economic downturn in the world and making efforts to survive in a co mpetitive and uncertain economic environ ment. Th is study will help to ameliorate div idend decisions of corporate sector through felicitously appropriate imp lementation of their div idend policies. This paper is an attempt to explicate the affect of d ividend announcements on stock prices of chemical and pharmaceutical industry of Pakistan. A sample of twenty nine co mpanies listed at KSE-100 Index is taken fro m the period of 2001 to 2010. Results of this study is predicated on Fixed and Random Effect Model wh ich is applied on Panel data to exp licate the relationship between dividends and stock prices after controlling the variables like Earnings per Share, Profit after Tax and Return on Equity. The Results show that Stock Dividend, Earnings per Share and Profit after Tax have a significant positive relation to stock market prices and significantly explicates the variations in the stock prices of chemical and pharmaceutical sector of Pakistan while Retention Ratio and Return on Equity have the negative insignificant relat ion with stock prices. This paper further shows that Dividend Irrelevance Theory is not applicable in case of chemical and pharmaceutical industry of Pakistan.
Stock Price Volatility in Relation to Dividend Policy; A Case Study of Karachi Stock Market
The research study has analyzed the stock price volatility by taking non-financial firms listed on Karachi Stock Exchange. The study is based on panel data that covers 35 firms for the period of 2001-2011. The main variable is dividend yield. The other explanatory variables taken by the study are; size, growth, earning per share and earning volatility. The research study has concluded that price volatility of stocks has a negative relationship with dividend yield and earnings per share. The research has identified a positive relationship of price volatility with size and growth in assets of firms. In addition, the research has identified that there is no relationship between price volatility and earning volatility of firms in Pakistan.
Stock Price Volatility and Role of Dividend Policy: Empirical Evidence from Pakistan
International Journal of Economics and Financial Issues, 2016
Despite years of empirical research, the linkage between dividend policy and stock price volatility (SPV) remains controversial among the researchers and scholars. This research endeavors to figure out the relationship between SPV and dividend policy of listed companies in Pakistan. A sample of 50 firms, based upon consistent dividend paying behavior, listed on Karachi Stock Exchange (KSE) has been selected from non-financial sectors, for the period of 2005-2012. Multiple regressions analyses have been carried on by applying random effect model on panel data i.e., for empirical estimation and robustness, panel estimated generalized least squares methods is used for finding relationship between dividend policy (dividend payout [DP] and dividend yield [DY]) and SPV after controlling for firm size (FS), asset growth (AG), long-term debt (LD), earning volatility (EV) and earnings per share (EPS). The study has found significant negative relationship between SPV and dividend policy varia...
Stock Price Volatility and Dividend Policy in Pakistan
The purpose of this study is to test impact of dividend policy on stock price volatility in Pakistan. The study had been carried out a stratified sampling containing companies in their respective sectors with respect to market capitalization, listed in KSE. Time series data was selected from year 2001-2014. Descriptive statistics, correlation and regression models were used to perform the data analysis. According to the findings of the regression all results were not significant. This means that dividend policy had no impact on stock price volatility in Pakistan.
This study is conducted with the objective to find out impact of dividend policy on stock price risk in Pakistan. The data of the study is taken from the published resources of State Bank of Pakistan and Karachi Stock Exchange regarding to five important sectors for the period 2005-2009. Descriptive statistics, correlation and regression models are used to perform the data analysis. The results of the study reveals that the correlation of price volatility and dividend yield is quite significant as compare to other variables. Moreover price volatility has negative correlation to the growth in assets. It is also inferred from the study that all the Variables are linked to the price Volatility; however, second model justifies the relational impact of some variables on the price volatility.
Dividend Policy and Share Price Volatility: Evidence from Pakistan
The main purpose of this study is to examine the relationship between dividend policy and share price volatility in Pakistani stock market. The cross sectional regression is used to analyze the relationship of share price with dividend yield and payout ratio. The dividend yield and share prices are positively relate but payout ratio is negatively related. This study suggest that dividend policy is effect the share price volatility in Pakistan and this study also proposed that signaling effect is also relevant in determining the share price volatility.
Impact of Dividend Policy on Stock Price Risk: Empirical Evidence from Equity Market of Pakistan
Far East Journal of Psychology and Business, 2011
This study is conducted with the objective to find out impact of dividend policy on stock price risk in Pakistan. The data of the study is taken from the published resources of State Bank of Pakistan and Karachi Stock Exchange regarding to five important sectors for the period 2005-2009. Descriptive statistics, correlation and regression models are used to perform the data analysis. The results of the study reveals that the correlation of price volatility and dividend yield is quite significant as compare to other variables. Moreover price volatility has negative correlation to the growth in assets. It is also inferred from the study that all the Variables are linked to the price Volatility; however, second model justifies the relational impact of some variables on the price volatility.
The Effects of Dividends on Stock Prices in Pakistan
This paper tests the effect of the change in the dividends on stock price behavior. The sample population for this study comprises of four companies from different industries. These companies are Hub co, Lucky Cement, Honda Atlas and Nishat Mills. The research is conducted by gathering five year data (2004 to 2009) of related firms regarding their dividend payments and stock prices. The Time series graph and pivot graphs are plotted on data. The time series graph of stock prices of lucky Cement, Atlas Honda and Nishat Mills show variability of stock prices. Time series graph of dividend per share goes against the stock prices trend. Pivot Chart shows the comparison of stock prices and dividend per share of individual company. The findings indicate that the stock prices of all sample companies change with the change in dividends per share. The correlation results show that there is strong positive or negative relationship has been found between stock prices and dividends per share. It is evident that most of the stock prices have negative correlation with the dividend per share.