A Dynamic Model for the Relationship between Optimal Dividend Policy and Growth Rate

2010 ◽  
Author(s):  
Cheng-Few Lee ◽  
Manak Gupta ◽  
Hong-Yi Chen ◽  
Alice C. Lee
Keyword(s):  
Growth Rate ◽  
Dynamic Model ◽  
Dividend Policy ◽  
Optimal Dividend ◽  
Optimal Dividend Policy ◽  
The Relationship

OPTIMAL DIVIDEND POLICY WITH MEAN-REVERTING CASH RESERVOIR

2007 ◽  
Vol 17 (1) ◽  
pp. 81-109 ◽  
Author(s):  
Abel Cadenillas ◽  
Sudipto Sarkar ◽  
Fernando Zapatero
Keyword(s):  
Dividend Policy ◽  
Optimal Dividend ◽  
Optimal Dividend Policy

scholarly journals Ukuran Perusahaan Memoderasi Pengaruh Free Cash Flow dan Leverage Terhadap Kebijakan Dividen

2019 ◽  
pp. 484
Author(s):  
I Kadek Edi Rian Trisna ◽  
Gayatri Gayatri
Keyword(s):  
Cash Flow ◽  
Firm Size ◽  
Dividend Policy ◽  
Stock Exchange ◽  
Free Cash Flow ◽  
Cash Dividend ◽  
Optimal Dividend ◽  
Current Growth ◽  
Optimal Dividend Policy ◽  
A Company

Determining the optimal cash dividend policy a company should consider several factors. An optimal dividend policy is required because it can create a balance between dividends and current growth in the next period. The purpose of this study is to obtain empirical evidence on the effect of free cash flow and leverage on dividend policy and firm size capability in moderating the effect of free cash flow and leverage against dividend policy. Companies going public listed on the Indonesia Stock Exchange (BEI) year 2013-2017 is the location of research with purposive sampling as a method of determining the sample. Companies that meet the criteria are 10 companies with a total of 39 observations. Moderated Regression Analysis (MRA) was used to test in this research. The result showed that free cash flow had positive and leverage effect negatively on dividend policy. The study also found that firm size is able to strengthen the effect of free cash flow on dividend policy and weaken the influence of leverage on dividend policy. Keywords: dividend policy, free cash flow, leverage, company size..  

scholarly journals The Optimal Dividend Payout Model with Terminal Values and Its Application

2017 ◽  
Vol 2017 ◽  
pp. 1-15
Author(s):  
Xiankang Luo ◽  
Peimin Chen ◽  
Jiangming Ma
Keyword(s):  
Value Function ◽  
Analytic Solution ◽  
Important Application ◽  
Stochastic Dynamic ◽  
Optimal Dividend ◽  
Optimal Value ◽  
The Status ◽  
Optimal Dividend Policy ◽  
The Relationship ◽  
Theoretical Results

For some firms with large nonliquid assets, preferred shareholders can still get back a little bit of money when the firms finish disbursement of loans at the status of bankruptcy. For such a situation, to investigate the optimal dividend policy, a stochastic dynamic dividend model with nonzero terminal bankruptcy values is put forward in this paper. Moreover, an analytic solution for the optimal objective function of the discounted dividends is provided and verified. An important application of this result is that it can be employed to construct the solution for the optimal value function on the dividend problem with bailouts at bankruptcy. Further, the relationship for the solutions of these two different problems is demonstrated. In the end, some numerical examples are provided to support our theoretical results and the corresponding economic interpretations are illustrated.

scholarly journals Determinants of Dividend Policy: A Panel Data Analysis for Turkish Listed Firms

2015 ◽  
Vol 10 (11) ◽  
pp. 149 ◽  
Author(s):  
Narman Kuzucu
Keyword(s):  
Growth Rate ◽  
Panel Data ◽  
Stock Market ◽  
Dividend Policy ◽  
Emerging Market ◽  
Panel Data Analysis ◽  
Firm Level ◽  
Family Control ◽  
Relationship Of ◽  
The Relationship

<p>Dividend policy of firms is one of the most controversial issues of theoretical finance. This paper aims to investigate the firm-level factors influencing the dividend decisions of firms from an emerging market. We examined eight-year panel data for the period from 2006 to 2013 from the Turkish stock market (Borsa Istanbul). The results show that financial leverage, size, growth rate, age, profitability, ownership structure and P/E ratio are statistically significant. The relationship of leverage, growth rate, profitability and family control with dividends is negative, whereas the relationship of size, age and P/E ratio is positive. Therefore, firms with higher debt ratios / growth rates / higher earnings are likely to retain more of their earnings. The empirical evidence from the Turkish stock market shows that the maturity hypothesis proposed by Grullon, Michaely and Swaminathan (2002) best explains the dividend behaviors of firms. Accordingly, as a firm matures, the availability of profitable projects reduces and earnings decrease. As the investment opportunities reduce, the need for resources decreases and the firm increases dividend payouts to shareholders.</p>

OPTIMAL DIVIDEND POLICY AND STOCK PRICES

2020 ◽  
Vol 23 (04) ◽  
pp. 2050023
Author(s):  
WEIPING LI
Keyword(s):  
Cash Flow ◽  
Stock Prices ◽  
Stock Price ◽  
Dividend Policy ◽  
Policy Problem ◽  
Capital Budget ◽  
Dividend Policies ◽  
Optimal Dividend ◽  
Hara Utility ◽  
Optimal Dividend Policy

We model a corporation dividend as an exchange option on stochastic cash flow and capital budge. Then we solve optimal dividend policy problem completely based on the dividend model under the assumption that the cash reservoir of a corporation follows a mean reverting process from empirical evidence and economic arguments. Our optimal dividend controls depend on explicitly with the cash flow and the capital budget of the corporation, and maximizes the HARA utility performance. We specify the unique optimal dividend control for the cash flow and the capital budge. Multiplicity or absence of optimal dividend policies are given. The stock price of the corporation is studied in terms of our stochastic dividend model. We find an explicit relation among the volatility of the stock price, the volatility of the cash flow and the volatility of the capital budget. The ex-dividend stock price is positively proportional to the stochastic cash flow and the probability of the dividend delta with respect to the cash flow, and negatively proportional to the capital budget and the probability of the dividend delta with respect to the capital budget. Hence, our approach provides another passage through which countercyclical volatility of the stock price can arise from the countercyclical cash flow and capital budget directly.

Optimal dividend policy

1989 ◽  
Vol 19 (1) ◽  
pp. 47-67 ◽  
Author(s):  
Wolfgang Ettl
Keyword(s):  
Dividend Policy ◽  
Optimal Dividend ◽  
Optimal Dividend Policy
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