Are certain dividend increases predictable? The effect of repeated dividend increases on market returns

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dc.contributor.author Michayluk, D
dc.contributor.author Neuhauser, K
dc.contributor.author Walker, S
dc.contributor.editor al, AAE
dc.date.accessioned 2012-02-02T11:11:40Z
dc.date.issued 2010-01
dc.identifier.citation Financial Management Association 2010 Meetings, 2010, pp. 1 - 38
dc.identifier.other E1 en_US
dc.identifier.uri http://hdl.handle.net/10453/16691
dc.description.abstract Positive abnormal returns around dividend increase announcements are well documented. The conventional explanation for these abnormal returns is that a dividend increase conveys favorable information about a firms prospects causing the stock price to increase in response to the announcement. This study offers a new perspective by studying a special group of firms that consistently increase their dividends each year. Abnormal returns around each dividend increase announcement are investigated based on the number of consecutive annual increases. In light of survey results that indicate firms endeavor to maintain steady dividend payments, one hypothesis is that after a certain number of dividend increases, a firm may develop a reputation as a dividend-increasing firm and consequently the market will learn to anticipate future dividend increases. Consistent with this hypothesis, we find that abnormal returns are significantly positive for the first and second dividend increase. Returns are not significant for all other increases, with the exception of the ninth consecutive increase. Our results suggest that, by the third consecutive increase, the market has learned to expect further increases. Our findings are robust and provide further evidence that, consistent with other types of corporate announcements, the stock market reacts differently depending on the frequency of an action.
dc.publisher Financial Management Association
dc.title Are certain dividend increases predictable? The effect of repeated dividend increases on market returns
dc.type Conference Proceeding
dc.parent Financial Management Association 2010 Meetings
dc.journal.number en_US
dc.publocation New York, USA en_US
dc.publocation New York, USA
dc.identifier.startpage 1 en_US
dc.identifier.endpage 38 en_US
dc.cauo.name BUS.School of Finance and Economics en_US
dc.conference Verified OK en_US
dc.conference Financial Management Association Annual Meeting
dc.conference Financial Management Association Annual Meeting
dc.for 150103 Financial Accounting
dc.personcode 995682
dc.personcode 930555
dc.percentage 100 en_US
dc.classification.name Financial Accounting en_US
dc.classification.type FOR-08 en_US
dc.edition en_US
dc.custom Financial Management Association Annual Meeting en_US
dc.date.activity 20101020 en_US
dc.date.activity 2010-10-20
dc.date.activity 2010-10-20
dc.location.activity New York, USA en_US
dc.location.activity New York, USA
dc.description.keywords NA
pubs.embargo.period Not known
pubs.organisational-group /University of Technology Sydney
pubs.organisational-group /University of Technology Sydney/Faculty of Business
pubs.organisational-group /University of Technology Sydney/Faculty of Business/Finance
pubs.organisational-group /University of Technology Sydney/Strength - Quantitative Finance
utslib.copyright.status Open Access
utslib.copyright.date 2015-04-15 12:23:47.074767+10
pubs.consider-herdc true
utslib.collection.history General (ID: 2)


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