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Article
The Market’s Perception of the Information Conveyed by Dividend Announcements
Articles and Chapters
  • Linda Canina, Cornell University School of Hotel Administration
Publication Date
1-1-1999
Abstract
This paper tests whether the market perceives announced dividend changes to reflect information about current and/or future cash flows. The empirical relationship between dividend changes and earnings changes is inconclusive. Furthermore, there is no empirical evidence regarding the market’s perception of managers’ intentions in changing the level of dividends. By analyzing the price reaction of scores to an announced dividend change, we are able to isolate the effects of a short-term change and a long-term change. Our findings indicate that the market perceives dividend changes to reflect a long-term change in earnings.
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Required Publisher Statement
© Elsevier. Final version published as: Canina, L. (1999). The market’s perception of the information conveyed by dividend announcements. Journal of Multinational Financial Management, 9(1), 1-13.
doi: 10.1016/S1042-444X(98)00049-8
Reprinted with permission. All rights reserved.

Citation Information

Canina, L. (1999). The market’s perception of the information conveyed by dividend announcements[Electronic version]. Retrieved [insert date], from Cornell University, School of Hotel Administration site: http://scholarship.sha.cornell.edu/articles/972