EFFECT OF DIVIDEND POLICY ON THE FINANCIAL PERFORMANCE OF QUOTED MANUFACTURING COMPANIES IN NIGERIA. (CASE STUDY OF GUINNESS, NIGERIA PLC)
Abstract
A dividend is a part of the profit that is distributed among the shareholders. When there is more profit, it increases the dividends which, in turn, increase the stock price of the firm and vice versa, when there is less profit it decreases the dividend payment and the stock price. In Nigeria the companies have no standard policy; therefore, they are open to decide about the dividend payment. The main objectives of the research are aimed at analyzing and investigating factors which affect financial performance of quoted companies such as dividend policy, capital structure short and long term, company size and company growth. In this research, the effect of dividend payment policy on the company’s future performance of the Nigerian stock exchange (NSE) listed companies (specifically Guinness) is analyzed. For this purpose, 4 hypotheses are developed and tested. The analyses are carried out by the econometric model (linear regression). The result shows that dividend policy, capital structure long term and company size influence the performance of the company (ROE).
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