Do dividends pattern follow earnings pattern? Evidence from Nigerian financial sector

The argument that the relationship between earnings and dividend have weakened stimulates the interest to revisit the relationship. The study adopts two approaches in testing this relationship.Using descriptive analysis, the study follow the approach of recent empirical studies in developed market t...

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Main Authors: Abdulkadir, Rihanat Idowu, Abdullah, Nur Adiana Hiau, Wong, Woei Chyuan
Format: Article
Language:English
Published: IISTE 2014
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Online Access:http://repo.uum.edu.my/15416/1/16234-18635-1-PB.pdf
http://repo.uum.edu.my/15416/
http://iiste.org/Journals/index.php/DCS/article/view/16234
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Institution: Universiti Utara Malaysia
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spelling my.uum.repo.154162016-04-12T06:45:16Z http://repo.uum.edu.my/15416/ Do dividends pattern follow earnings pattern? Evidence from Nigerian financial sector Abdulkadir, Rihanat Idowu Abdullah, Nur Adiana Hiau Wong, Woei Chyuan HG Finance The argument that the relationship between earnings and dividend have weakened stimulates the interest to revisit the relationship. The study adopts two approaches in testing this relationship.Using descriptive analysis, the study follow the approach of recent empirical studies in developed market to test whether dividend concentration exists among financial firms in the Nigerian market and whether this is driven by earnings concentration among the firms. Secondly, the study tests the relationship between earnings and dividend in a regression model to confirm whether this relationship has weakened or not. Findings based on a sample of 49 financial firms on the Nigerian Stock Exchange indicates presence of dividend concentration and show that this is as a result of earnings concentration.Findings from fixed effects regression estimates also indicate that earnings have strong predictive power in explaining dividend payout even when other determinants are accounted for. Based on the combined evidence from descriptive analysis and regression results, the study concludes that dividends are sensitive to earnings and the relationship between the two remain strong in explaining payout policies in the Nigerian financial service sector. IISTE 2014 Article PeerReviewed application/pdf en cc_by http://repo.uum.edu.my/15416/1/16234-18635-1-PB.pdf Abdulkadir, Rihanat Idowu and Abdullah, Nur Adiana Hiau and Wong, Woei Chyuan (2014) Do dividends pattern follow earnings pattern? Evidence from Nigerian financial sector. Developing Country Studies, 4 (20). pp. 45-50. ISSN 2224-607X http://iiste.org/Journals/index.php/DCS/article/view/16234
institution Universiti Utara Malaysia
building UUM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Utara Malaysia
content_source UUM Institutionali Repository
url_provider http://repo.uum.edu.my/
language English
topic HG Finance
spellingShingle HG Finance
Abdulkadir, Rihanat Idowu
Abdullah, Nur Adiana Hiau
Wong, Woei Chyuan
Do dividends pattern follow earnings pattern? Evidence from Nigerian financial sector
description The argument that the relationship between earnings and dividend have weakened stimulates the interest to revisit the relationship. The study adopts two approaches in testing this relationship.Using descriptive analysis, the study follow the approach of recent empirical studies in developed market to test whether dividend concentration exists among financial firms in the Nigerian market and whether this is driven by earnings concentration among the firms. Secondly, the study tests the relationship between earnings and dividend in a regression model to confirm whether this relationship has weakened or not. Findings based on a sample of 49 financial firms on the Nigerian Stock Exchange indicates presence of dividend concentration and show that this is as a result of earnings concentration.Findings from fixed effects regression estimates also indicate that earnings have strong predictive power in explaining dividend payout even when other determinants are accounted for. Based on the combined evidence from descriptive analysis and regression results, the study concludes that dividends are sensitive to earnings and the relationship between the two remain strong in explaining payout policies in the Nigerian financial service sector.
format Article
author Abdulkadir, Rihanat Idowu
Abdullah, Nur Adiana Hiau
Wong, Woei Chyuan
author_facet Abdulkadir, Rihanat Idowu
Abdullah, Nur Adiana Hiau
Wong, Woei Chyuan
author_sort Abdulkadir, Rihanat Idowu
title Do dividends pattern follow earnings pattern? Evidence from Nigerian financial sector
title_short Do dividends pattern follow earnings pattern? Evidence from Nigerian financial sector
title_full Do dividends pattern follow earnings pattern? Evidence from Nigerian financial sector
title_fullStr Do dividends pattern follow earnings pattern? Evidence from Nigerian financial sector
title_full_unstemmed Do dividends pattern follow earnings pattern? Evidence from Nigerian financial sector
title_sort do dividends pattern follow earnings pattern? evidence from nigerian financial sector
publisher IISTE
publishDate 2014
url http://repo.uum.edu.my/15416/1/16234-18635-1-PB.pdf
http://repo.uum.edu.my/15416/
http://iiste.org/Journals/index.php/DCS/article/view/16234
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