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Internal and external factors of dividend payout policy: Evidence from Malaysian Construction Sector / Muhammad Hafiz Ali, Norhuda Abdul Rahim and Mohamed Hisham Yahya

This study is set to identify the internal and external determinants of dividend policy of Malaysian listed construction firms. In specific, this study (1) investigates which determinants strongly explain dividend policy’s proxy and (2) identifies the relationship between firms’ internal and externa...

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Main Authors: Ali, Muhammad Hafiz, Abdul Rahim, Norhuda, Yahya, Mohamed Hisham
Format: Article
Language:English
Published: Universiti Teknologi MARA, Negeri Sembilan
Subjects:
Financial management. Business finance. Corporation finance
Dividends. Stock dividends. Dividend reinvestment
Malaysia
Online Access:https://ir.uitm.edu.my/id/eprint/53888/1/53888.pdf
https://ir.uitm.edu.my/id/eprint/53888/
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spelling my.uitm.ir.538882021-12-02T07:05:25Z https://ir.uitm.edu.my/id/eprint/53888/ Internal and external factors of dividend payout policy: Evidence from Malaysian Construction Sector / Muhammad Hafiz Ali, Norhuda Abdul Rahim and Mohamed Hisham Yahya Ali, Muhammad Hafiz Abdul Rahim, Norhuda Yahya, Mohamed Hisham Financial management. Business finance. Corporation finance Dividends. Stock dividends. Dividend reinvestment Malaysia This study is set to identify the internal and external determinants of dividend policy of Malaysian listed construction firms. In specific, this study (1) investigates which determinants strongly explain dividend policy’s proxy and (2) identifies the relationship between firms’ internal and external determinants with dividend policy’s proxy. This study’s specification model is developed using the Dividend Smoothing Theory. Four firms’ internal factors (EPS, SIZE, lagDIV, FCFps) and one firms’ external factor (MBeta) are investigated. Panel data regression analysis of Ordinary Pooled Least Squares, Fixed Effects Model and Random Effects model are used to investigate the identified factors. The findings highlight that the Fixed Effects Model is the most appropriate, with an explanatory power of 33.73%. Three firms’ internal factors variables (EPS, lagDIV, and FCFps) are significant and positively affect firms’ dividend policy. This study also investigates other empirically proven firm’s factors and found that they are not significant. Furthermore, they worsened the model’s explanatory power. Thus, proving a unique difference in dividend policy’s predictors of the different economic sectors. Universiti Teknologi MARA, Negeri Sembilan Article PeerReviewed text en https://ir.uitm.edu.my/id/eprint/53888/1/53888.pdf ID53888 Ali, Muhammad Hafiz and Abdul Rahim, Norhuda and Yahya, Mohamed Hisham Internal and external factors of dividend payout policy: Evidence from Malaysian Construction Sector / Muhammad Hafiz Ali, Norhuda Abdul Rahim and Mohamed Hisham Yahya. Journal of Academia, 9. pp. 173-182. ISSN 2289-6368
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 Financial management. Business finance. Corporation finance
Dividends. Stock dividends. Dividend reinvestment
Malaysia
spellingShingle Financial management. Business finance. Corporation finance
Dividends. Stock dividends. Dividend reinvestment
Malaysia
Ali, Muhammad Hafiz
Abdul Rahim, Norhuda
Yahya, Mohamed Hisham
Internal and external factors of dividend payout policy: Evidence from Malaysian Construction Sector / Muhammad Hafiz Ali, Norhuda Abdul Rahim and Mohamed Hisham Yahya
description This study is set to identify the internal and external determinants of dividend policy of Malaysian listed construction firms. In specific, this study (1) investigates which determinants strongly explain dividend policy’s proxy and (2) identifies the relationship between firms’ internal and external determinants with dividend policy’s proxy. This study’s specification model is developed using the Dividend Smoothing Theory. Four firms’ internal factors (EPS, SIZE, lagDIV, FCFps) and one firms’ external factor (MBeta) are investigated. Panel data regression analysis of Ordinary Pooled Least Squares, Fixed Effects Model and Random Effects model are used to investigate the identified factors. The findings highlight that the Fixed Effects Model is the most appropriate, with an explanatory power of 33.73%. Three firms’ internal factors variables (EPS, lagDIV, and FCFps) are significant and positively affect firms’ dividend policy. This study also investigates other empirically proven firm’s factors and found that they are not significant. Furthermore, they worsened the model’s explanatory power. Thus, proving a unique difference in dividend policy’s predictors of the different economic sectors.
format Article
author Ali, Muhammad Hafiz
Abdul Rahim, Norhuda
Yahya, Mohamed Hisham
author_facet Ali, Muhammad Hafiz
Abdul Rahim, Norhuda
Yahya, Mohamed Hisham
author_sort Ali, Muhammad Hafiz
title Internal and external factors of dividend payout policy: Evidence from Malaysian Construction Sector / Muhammad Hafiz Ali, Norhuda Abdul Rahim and Mohamed Hisham Yahya
title_short Internal and external factors of dividend payout policy: Evidence from Malaysian Construction Sector / Muhammad Hafiz Ali, Norhuda Abdul Rahim and Mohamed Hisham Yahya
title_full Internal and external factors of dividend payout policy: Evidence from Malaysian Construction Sector / Muhammad Hafiz Ali, Norhuda Abdul Rahim and Mohamed Hisham Yahya
title_fullStr Internal and external factors of dividend payout policy: Evidence from Malaysian Construction Sector / Muhammad Hafiz Ali, Norhuda Abdul Rahim and Mohamed Hisham Yahya
title_full_unstemmed Internal and external factors of dividend payout policy: Evidence from Malaysian Construction Sector / Muhammad Hafiz Ali, Norhuda Abdul Rahim and Mohamed Hisham Yahya
title_sort internal and external factors of dividend payout policy: evidence from malaysian construction sector / muhammad hafiz ali, norhuda abdul rahim and mohamed hisham yahya
publisher Universiti Teknologi MARA, Negeri Sembilan
url https://ir.uitm.edu.my/id/eprint/53888/1/53888.pdf
https://ir.uitm.edu.my/id/eprint/53888/
_version_ 1718929597843636224
score 13.211869

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