Staff View: Information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / Norhayati Mohamed … [et al.]

Information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / Norhayati Mohamed … [et al.]

The study aims to identify the type of information that firms are trying to convey when they change dividend. The first step is to test the relationship between unexpected dividend changes and stock prices by employing the event study methodology. The next step is to evaluate the information content...

Full description

Saved in:

Bibliographic Details
Main Authors:	Mohamed, Norhayati, Abdul Hamid, Mohamad Ali, Md Nassir, Annuar, Mohamed, Shamsher
Format:	Article
Language:	English
Published:	Faculty of Accountancy & Accounting Research Institute (ARI) 2006
Subjects:	Accounts and books. General works Dividends. Stock dividends. Dividend reinvestment
Online Access:	http://ir.uitm.edu.my/id/eprint/13789/1/AJ_NORHAYATI%20MOHAMED%20MAR%2006.pdf http://ir.uitm.edu.my/id/eprint/13789/ https://mar.uitm.edu.my/
Tags:	Add Tag No Tags, Be the first to tag this record!

id	my.uitm.ir.13789
record_format	eprints
spelling	my.uitm.ir.137892016-07-21T09:06:14Z http://ir.uitm.edu.my/id/eprint/13789/ Information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / Norhayati Mohamed … [et al.] Mohamed, Norhayati Abdul Hamid, Mohamad Ali Md Nassir, Annuar Mohamed, Shamsher Accounts and books. General works Dividends. Stock dividends. Dividend reinvestment The study aims to identify the type of information that firms are trying to convey when they change dividend. The first step is to test the relationship between unexpected dividend changes and stock prices by employing the event study methodology. The next step is to evaluate the information content of dividend changes in the context of three hypotheses: the cashflow signaling hypothesis, the dividend clientele hypothesis and the free cashflow hypothesis. Past explanation to the effect of dividend changes on stock prices is that firms are signalling their current and/or future cashflow of the firm, or known as the cashflow signalling hypothesis. Later studies have incorporated other explanations, which are the dividend clientele hypothesis and the free cash flow hypothesis. Regression analysis is applied to study the wealth effect of dividend changes on stock prices and to test for the three hypotheses. The effect of firm size on the relationship between dividend changes and stock prices are also analysed by using total assets per share as the proxy variable for firm size. The findings show a significant relationship between unexpected dividend changes and stock prices, which also constitute support for the cash flow signalling hypothesis. Mixed support is found for the dividend clientele hypothesis while strong support is found for the free cash flow hypothesis. Faculty of Accountancy & Accounting Research Institute (ARI) 2006 Article PeerReviewed text en http://ir.uitm.edu.my/id/eprint/13789/1/AJ_NORHAYATI%20MOHAMED%20MAR%2006.pdf Mohamed, Norhayati and Abdul Hamid, Mohamad Ali and Md Nassir, Annuar and Mohamed, Shamsher (2006) Information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / Norhayati Mohamed … [et al.]. Malaysian Accounting Review, 5 (1). pp. 65-84. ISSN 1675-4077 https://mar.uitm.edu.my/
institution	Universiti Teknologi Mara
building	Tun Abdul Razak Library
collection	Institutional Repository
continent	Asia
country	Malaysia
content_provider	Universiti Teknologi Mara
content_source	UiTM Institutional Repository
url_provider	http://ir.uitm.edu.my/
language	English
topic	Accounts and books. General works Dividends. Stock dividends. Dividend reinvestment
spellingShingle	Accounts and books. General works Dividends. Stock dividends. Dividend reinvestment Mohamed, Norhayati Abdul Hamid, Mohamad Ali Md Nassir, Annuar Mohamed, Shamsher Information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / Norhayati Mohamed … [et al.]
description	The study aims to identify the type of information that firms are trying to convey when they change dividend. The first step is to test the relationship between unexpected dividend changes and stock prices by employing the event study methodology. The next step is to evaluate the information content of dividend changes in the context of three hypotheses: the cashflow signaling hypothesis, the dividend clientele hypothesis and the free cashflow hypothesis. Past explanation to the effect of dividend changes on stock prices is that firms are signalling their current and/or future cashflow of the firm, or known as the cashflow signalling hypothesis. Later studies have incorporated other explanations, which are the dividend clientele hypothesis and the free cash flow hypothesis. Regression analysis is applied to study the wealth effect of dividend changes on stock prices and to test for the three hypotheses. The effect of firm size on the relationship between dividend changes and stock prices are also analysed by using total assets per share as the proxy variable for firm size. The findings show a significant relationship between unexpected dividend changes and stock prices, which also constitute support for the cash flow signalling hypothesis. Mixed support is found for the dividend clientele hypothesis while strong support is found for the free cash flow hypothesis.
format	Article
author	Mohamed, Norhayati Abdul Hamid, Mohamad Ali Md Nassir, Annuar Mohamed, Shamsher
author_facet	Mohamed, Norhayati Abdul Hamid, Mohamad Ali Md Nassir, Annuar Mohamed, Shamsher
author_sort	Mohamed, Norhayati
title	Information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / Norhayati Mohamed … [et al.]
title_short	Information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / Norhayati Mohamed … [et al.]
title_full	Information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / Norhayati Mohamed … [et al.]
title_fullStr	Information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / Norhayati Mohamed … [et al.]
title_full_unstemmed	Information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / Norhayati Mohamed … [et al.]
title_sort	information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / norhayati mohamed … [et al.]
publisher	Faculty of Accountancy & Accounting Research Institute (ARI)
publishDate	2006
url	http://ir.uitm.edu.my/id/eprint/13789/1/AJ_NORHAYATI%20MOHAMED%20MAR%2006.pdf http://ir.uitm.edu.my/id/eprint/13789/ https://mar.uitm.edu.my/
_version_	1685648433478631424
score	13.211869

Information content of dividend changes : cash flow signalling, dividend clientele and free cash flow hypotheses / Norhayati Mohamed … [et al.]

Similar Items