Dividend-protected employee stock options and payout policy

• Main Authors: Chin,Chen-Ling, 金珍玲
• Other Authors: Kao,Erin H.
• Format: Others
• Language: zh-TW
• Published: 2011
• Online Access: http://ndltd.ncl.edu.tw/handle/15149152027809904837

碩士 === 嶺東科技大學 === 財務金融研究所 === 99 === This paper we examine how dividend-protected employee stock options affect payout policy. Using Tobit model estimators a sample of 1723 Taiwanese firm from 2001 to2010. This study finds a positive relationship between employee stock options and payout policy, imply that manager hold employee stock options prefer distribute cash dividend to boot the stock price. Manager also use stock repurchases to avoid dilution of EPS and reduce outstanding share. If company holds too much free cash flow, managers will not investment good plan, causing firm value decrease. Therefore, when the firm does not have the good opportunities for investment, and they might use payout policy as a positive signal to distribute excess free cash flow.