The Signaling Content of Stock Dividend and Corporate Performance

• Main Authors: Chen bSheng-Chung, 陳聖中
• Other Authors: Yen-Sheng Huang
• Format: Others
• Language: zh-TW
• Published: 1998
• Online Access: http://ndltd.ncl.edu.tw/handle/55846453159353722000

碩士 === 國立臺灣科技大學 === 管理技術研究所 === 86 === This thesis examines whether stock dividend announcements convey useful information about a firm''s future performance. If stock dividend announcements reflect managers'' anticipation about a firm*s future performance, we would expect dividend increases to be associated wit'' better performance in the future. The sample consists of 683 stock dividend announcement events from 1983 to 1994. All samples are divided into three groups according to whether the sample firm experience an increase, decrease or no change in stock dividends. We calculate unexpected performance changes for the current year and the two subsequent years for each firm. We investigate whether the information content of stock dividend announcements are affected by the percentage unexpected change in stock dividends, size of firm and industry effect. The results of the stuyconcerning the information content of stock dividendannouncements are: 1.Stock dividend announcements are found to convey information about the firm''s future performance. In current year and subsequent year, firms that increase stock dividends have better performance. In contrast, firms that decrease stock dividends have worse performance. 2.For firms with lower earnings in the previous year but high dividends in the current year, their current year''s performance is found to be better. 3.The higher the percentage unexpected change in stock dividends, the better the operating performance in the current year. 4.Smaller firms are found to experience better performance. In addition, the information contents of stock dividend announcements are not affected by the type of industry.