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Ownership structure influencing the joint determination of dividend, leverage, and cost of capital

Rajverma, Abhinav Kumar; Arrawatia, Rakesh; Misra, Arun … - In: Cogent economics & finance 7 (2019) 1, pp. 1-25

The article analyses inter-dependencies between dividend, capital structure, and cost of capital, factoring the … concentrated ownership. Dividend, leverage, and average cost of capital are inter-linked. However, family firms pay lower dividends …

Persistent link: https://www.econbiz.de/10012023922

Do Capital Structure Models Square with the Dynamics of Payout?

Chen, Shiqi; Lambrecht, Bart M. - 2021

We explore whether theoretically the target leverage and pecking order models can be reconciled with payout smoothing. Investment absorbs a significant part of income and asset volatility if the firm follows both a payout target and a net debt ratio (NDR) target. A positive (negative) NDR...

Persistent link: https://www.econbiz.de/10013225267

Dividend Policy and Capital Structure : Testing Endogeneity

Abbas, Asad - 2016

The study is aimed at exploring the relationship between dividend payout and capital structure, and to explore the … determinants of dividend policy and capital structure of manufacturing sector of Pakistan. Penal data ranging from 2006 to 2011 of … selected 100 manufacturing firms of Pakistan is used in this study. Dividend policy and capital structure have their own …

Persistent link: https://www.econbiz.de/10012997095

Modeling Managers As EPS Maximizers

Ben-David, Itzhak; Chinco, Alexander M. - National Bureau of Economic Research - 2023

Textbook theory assumes that firm managers maximize the net present value of future cash flows. But when you ask them, real-world firm managers consistently say that they are maximizing something else entirely: earnings per share (EPS). Perhaps this is a mistake. No matter. We take firm managers...

Persistent link: https://www.econbiz.de/10014250143

A Test of the Modigliani-Miller Theorem, Dividend Policy and Algorithmic Arbitrage in Experimental Asset Markets

Neugebauer, Tibor; Shachat, Jason; Szymczak, Wiebke - 2022

suggested that dividend policy makes no difference to this law of one price. We experimentally test the MM theorem in a complete … the dividend stream. According to this variation the dividend payout order is either identical or independent. The second … when dividend payout order is independent unless the arbitrageur keeps the asset prices in balance …

Persistent link: https://www.econbiz.de/10013307611

Modeling Managers As EPS Maximizers

Ben-David, Itzhak; Chinco, Alex - 2023

Textbook theory assumes that firm managers maximize the net present value of future cash flows. But when you ask them, the people running large public corporations say that they are maximizing something else entirely: earnings per share (EPS). Perhaps this is a mistake. No matter. We take...

Persistent link: https://www.econbiz.de/10014351328

The relationship between changes in corporate payout policy and capital structure

Kim, Songhee; Khil, Jaeuk; Lee, Yu Kyung - In: Journal of derivatives and quantitative studies 32 (2024) 2, pp. 116-144

This paper aims to investigate the impact of corporate dividend policy on the capital structure in the Korean stock … market. To distinctly discern the voluntariness of changes in corporate dividend policy, we analyze companies that, following … increase, revealing a symmetric relationship between dividend policy and capital structure. In conclusion, large dividend …

Persistent link: https://www.econbiz.de/10015054088

Zero-debt policy under asymmetric information, flexibility and free cash flow considerations

Miglo, Anton - In: Journal of risk and financial management : JRFM 13 (2020) 12/296, pp. 1-25

We build a model of debt for firms with investment projects, for which flexibility and free cash flow problems are important issues. We focus on the factors that lead the firm to select the zero-debt policy. Our model provides an explanation of the so-called "zero-leverage puzzle". It also helps...

Persistent link: https://www.econbiz.de/10012392204

Cash holdings and financing decisions under ambiguity

Agliardi, Elettra; Agliardi, Rossella; Spanjers, Willy - 2014

This paper addresses the following unresolved questions: Why do some firms issue equity instead of debt? Why did most firms retain their cash holdings instead of distributing them as dividends in recent times? How do firms change their financing policies during a period of severe financial...

Persistent link: https://www.econbiz.de/10011715949

The Lintner model revisited : dividends versus total payouts

Andres, Christian; Doumet, Markus; Fernau, Erik; … - 2014 - This version: October 2013

We analyze how the introduction of repurchases in 1998, and a major tax reform in 2001, affected the payout policy of German firms. To this end, we estimate Lintner (1956) partial adjustment models for both dividends and total payouts. We also analyze the implications for payout of changes in...

Persistent link: https://www.econbiz.de/10010340376

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