Impact of Dividend Policy on the Market Value of the Company

Abstract

The article is devoted to the analysis and assessment of the impact of dividends on the market value of the company. The study is based on data from company reports and statistics from the Moscow Exchange. This paper presents a regression analysis of a choice consisting of 1) 20 systems of Russian companies and 2) 5 largest companies in the oil and gas sector for the period 2013-2019. The regression results show that dividends have a positive effect on capitalization only if the policy is based on the residual principle. The conclusions made in the work, which provide recommendations and a statistical assessment of dependence, can find practical application in determining the dividend policy of an organization and predicting changes in the capitalization of companies.

Board dynamics, dividend pay-out policy and banking efficiency in an emerging market context

“…This shows that owners who receive more dividend payments do not invest in growth opportunities that increase market wealth. Our findings disagree with the findings of Eryomin et al (2021), who show that dividends have a positive effect on capitalization only if the policy is based on the residual principle. This supports the residual theory as the company prefers to preserve its profits for the sake of goodwill or gains in the future.…”

Which Firm Characteristics Drive Dividend Policy and Firm Value in the Consumer Goods Sector of the Nigerian Exchange Group?

“…They found a positive significant relationship in Indonesian manufacturing companies from 2006 to 2011 (Rizqia & Sumiati, 2013). Similarly, Eryomin et al (2021) in Russia found a positive significant impact by applying regression analysis on data from 2013 to 2019 (Eryomin et al, 2021). Furthermore, Bon and Hartoko (2022), focusing on the Indonesian manufacturing sector, discovered that dividend policy does not significantly influence firm value.…”